The US Treasury Department is the national treasury and finance department of the federal government of the United States. It is responsible for many acts and in 2021, the department levied limitations on SUEX because of allegations of financial fraud and money laundering acts, as said by Maxim Kurbangaleev.
This incident becomes one of the reasons for initiating extensive limitations on the cryptocurrencies by the governments.
As per the US Treasury Department, SUEX was involved in illegal money generation, its laundering, and Hydra payments. Hydra is one of the largest drug trafficking platforms.
The Prime Reason Behind Sanctions On SUEX
Maxim Kurbagaleey Said which concludes
“The cryptocurrency market consistently brings new challenges into reality which grab analysts’ attention. The Sanctions imposed on the SUEX became a strange act. As of now, it is not possible to consolidate the regulations of the cryptocurrency industry and control its services that possibly affect any business. The major concern is the absence of a strong legislative framework that can control the market as businesses.”
“SUEX cryptocurrency’s turnover was analysed by the transaction monitoring services on Binance accounts. However, American Law Enforcement agencies levy sanctions restrictions and don’t consider the results of AML monitoring. The apprehension of financial fraud and the possibility of money laundering are sufficient reasons to ban crypto trading. Ultimately, this decision doesn’t affect every cryptocurrency holder except the ones who were using the SUEX wallet on Binance to make financial transactions. These types of accounts got “black label”.
This account labelling is comparable with the turnover of cash, without it, it is nearly impossible to track the money unless it reaches the “user’s account”.
“People directly involved in the case of drug trafficking are those who purchased because the funds involved in the transactions are noticed in the illegal transactions”.
The Need For Kyc
Maxim Kurbagaleey Said which concludes
“The absence of right confidence in the next day’s prospects is disseminated in the cryptocurrency industry. Presently, we can observe optimistic changes in the transformations of AML-verification protocols. However, we can’t deny the fact that detailed transaction analytics take a significant amount of resources and everyone’s crypto wallet may fall under the financial fraud category along with the cryptocurrency companies.”
How Can We Identify The Risks And Stop The SUEX-Type Incident Again?
It is important to implement KYC procedures and complete verification of all users and clients. Apart from KYC, checking SOF and SOW can be used to check the source of funds and source of wealth respectively. In addition, monitoring all cryptocurrency transactions can be worth dealing with potential fraud chances. These measures will demotivate criminals and help in their identification by making it convenient to trace illegal money generated from drug trafficking.
Maxim Kurbagaleey Said which concludes
“The Cryptocurrency industry is filled with risks and we should always remember and work with caution. One should regularly consult with lawyers. Legit business, complete user verification and strong operations management are the basics to run a successful cryptocurrency business.”