Facebook Libra: The Latest Crypto Used in Illegal Financial Activities?

“With the evolution of virtual currencies and new marketplaces, nefarious actors are continuously adapting to find new ways to engage in illegal financial activity.” said U.S. Representatives Emanuel Cleaver, during the briefing with Financial Crimes Enforcement Network (FinCEN) on 27 June.

The discussion with FinCEN focused on the use of AI and ML technology to detect illicit financial activity. Cleaver is concerned about Facebook’s Libra project during the briefing. He is doubtful on Facebook’s ability to identify bad actors and thus the ability to prevent financial fraud. He added “We’ve seen the significant damage that foreign adversaries and bad actors have wrought on our democracy through Facebook’s platform, and that was simply through messaging and advertising.”

Cleaver has been very active in encouraging corporations and regulators to prevent the use of cryptocurrencies in illegal activities. For instance, Cleaver sent a letter in July 2018, calling on FinCEN to investigate the case where 12 Russian intelligence officials had been accused of using cryptocurrencies to interfere the 2016 election and request FinCEN to provide further guidance on preventing the financial crimes. In March 2019, Cleaver also sent a letter to FinCEN Director Kenneth Blanco to host a briefing on the working progress of the bureau and steps to be taken.

Congressman Trey Hollingsworth said “I appreciated Director Blanco and his team for sharing the Bureau’s ongoing efforts to use AI/ML to combat money laundering and to collaborate with both financial institutions and technology providers to help strengthen our financial system.”

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