FATF downgrades Russia due to lack of regulation of cryptocurrencies

The International Anti-Money Laundering Task Force (FATF) has downgraded one of Russia's ratings due to a lack of regulation of cryptocurrencies and control over illegal transactions with digital assets.

The FATF conducted an audit on the compliance of procedures to combat money laundering through cryptocurrencies from July to December 2023. As the deputy head of Rosfinmonitoring German Neglyad said, the rating contains 40 main recommendations to combat money laundering and one of them is a recommendation to combat money laundering through cryptocurrencies. The organization’s experts considered that the level of regulation was insufficient and lowered Russia’s rating on this recommendation from “compliant” to “partially compliant.”

“We have now assessed how Russia complies with the already amended recommendations. Russia's rating has been downgraded to “partial compliance,” indicating remaining weaknesses in this area. First of all, this is the need to regulate the circulation of cryptocurrency, that is, the activities of cryptocurrency exchanges and exchangers by analogy with financial organizations,” Neglyad emphasized.

The report notes that bills to regulate the cryptocurrency space in Russia are still in development.

Let us recall that a possible downgrade of Russia’s rating was reported back in December last year.