Nikolas Sargeant
A statutory instrument released on Feb. 29 outlines amendments to the Economic Crime and Corporate Transparency Act 2023, empowering the National Crime Agency to confiscate crypto assets tied to illicit activities. The new law simplifies the procedure, allowing for the freezing of cryptocurrency assets without lengthy legal protocols.
Starting April 26, the UK's economic crime legislation will include civil recovery orders for seizing crypto assets. Authorities can now retrieve these assets directly from exchanges and custodian wallet providers, with the option to destroy them when necessary.
Though not explicitly mentioned, the standard practice for destroying a crypto token involves burning it and transferring the tokens to a burn wallet address, effectively removing them from circulation.
One notable provision in the Economic Crime and Corporate Transparency Bill allows for the recovery of crypto assets involved in crimes without the need for an initial arrest, addressing situations where individuals evade conviction by staying abroad.
Additionally, the bill criminalizes resisting or assaulting law enforcement officers during the process of seizing a cryptocurrency asset.
Combatting Cryptocurrency Crimes
The United Kingdom is taking proactive measures to tackle concerns surrounding cryptocurrency involvement in criminal activities, including cybercrime, scams, and drug trafficking.
A pivotal step was the introduction of the Economic Crime and Corporate Transparency Bill in 2022, officially becoming an Act of Parliament on October 26, 2023. This legislative response addresses the evolving landscape of financial crimes, encompassing money laundering, fraud, bribery, and corruption.
In September 2022, the National Crime Agency (NCA) established the 'Crypto Cell,' a specialized division focused on digital crimes associated with cryptocurrencies. Operating within the National Cyber Crime Unit, this initiative emphasizes the UK's commitment to addressing cyber threats and financial crimes related to cryptoassets.
Moreover, in March 2023, the UK and the U.S. jointly announced sanctions against seven Russian cyber criminals linked to ransomware attacks. These sanctions include freezing assets and imposing restrictions on their use of the global financial system.
Looking forward, the UK government remains dedicated to introducing new legislation governing stablecoins and crypto staking within the next six months. Economic Secretary to the Treasury Bim Afolami underscores the commitment, aiming for consultation on final rules by mid-2024 and the implementation of the stablecoin regime in 2025.
Despite earlier promises and consultations, significant progress has been made in creating a conducive regulatory environment for crypto firms operating in the UK.
