You’d be forgiven for thinking the regulatory ripple effect was all about Wells Fargo. After all, the steadily louder drumbeat for CEO Tim Sloan’s resignation may have finally taken its toll, as he retired in what was widely viewed as a surprise move late last week.
The chorus was led by Democrat Rep. Maxine Waters of California, who is head of the House Financial Services Committee. Now the question is what will happen to the bank that has new leadership in place but still faces its spate of scandals and a cap on its asset size, courtesy of the Federal Reserve.
You might also be forgiven for thinking that payday lending rules — or a stay of them — would be the subject most illuminated in the spotlight.
But beyond those two stories you’d find some developments within the crypto space, taking shape well beyond the confines of U.S. shores. In one example, as noted by CoinDesk, Pakistan is mandating regulations for the crypto space. Recommendations from that nation’s Financial Action Task Force governing the electronic money institutions have may be on offer, and would require those firms to be licensed by the government. Though the framework has not yet been made public, the rules reportedly would institute capital requirements, and also stipulate know your customer (KYC) processes. The task force had said late last year that cryptos present money laundering and terrorist financing risks.
“There is an urgent need for all countries to take coordinated action to prevent the use of virtual assets for crime and terrorism,” said the task force in October.
An Exchange Shutters
Separately, in India, Coindelta, a cryptocurrency exchange, shut down a scant 18 months after launch, stating that trading services were terminated on March 30. As reported by Finance Magnates, and per a post by Coindelta founder Shubham Yadav, the regulatory climate in India forced the shutdown.
“It has been really difficult for us to operate Coindelta exchange for the last 6 months,” Yadav noted on a Medium post. “The curb on the bank accounts by RBI [Reserve Bank of India] has made us handicapped in order to provide seamless deposit and withdrawal services. There has not been any significant progress in the Supreme Court case which makes it difficult to predict when we will see the regulation.” As has been previously reported, banks have been prohibited from dealing with those crypto businesses.
Warmer Climate in Bermuda
As has been previously reported, as much as $145 million has been lost (or frozen) from Quadriga’s cryptocurrency exchange as passwords were lost in the wake of the CEO’s death, and the cold wallets are inaccessible.
Bermuda’s Burt has said there are rules governing the management and custody of master keys, and they cannot be held by only one individual, according to the report. Those rules are tied to Bermuda’s digital asset business act from last year, which in turn govern blockchain and cryptos. Thus far several dozen FinTechs have been operating in that country and the first currency exchange, Omega Dark, has been approved.
Beyond cryptos, and toward more traditional financial services, last week the supervisory authority (FSA) in Norway said in its latest annual report that several banks’ anti-money laundering (AML) assessments last year were insufficient. The report did not single out which firms had shown insufficient efforts.
The report comes in the wake of scandals involving Nordic firms such as those seen with Danske Bank, where that firm’s Estonian branch was a conduit for $227 billion of suspicious payments spanning 2007 to 2015.