Virtual currencies are frequently used by fraud groups as a tool for money laundering or as a medium for fraud in Taiwan. These illegally obtained digital assets are converted into Taiwanese dollars through a series of transactions with individual currency traders. According to statistics from the Criminal Investigation Bureau’s Anti-Fraud Center, over 700 million Taiwanese dollars in financial losses have been reported in the past four years.
However, according to a report by the “Liberty Times,” under the current regulations, even if the police and prosecutors trace individual currency traders who assist in these transactions, they often evade punishment by claiming to be “uninformed third parties” who only assist in transactions to earn commissions. This makes it difficult for the prosecution to bring charges against these individuals. At most, they can only be fined between 50,000 and 1 million Taiwanese dollars under Article 6 of the Anti-Money Laundering Act for “failure to establish internal controls and audit systems for anti-money laundering.”
In response, the Ministry of Justice has proposed amending the Anti-Money Laundering Act to require currency traders to submit a “Declaration of Compliance with Anti-Money Laundering Regulations” to the Financial Supervisory Commission for record-keeping before providing related transaction services. The declaration should include detailed information such as the company, responsible person, actual beneficiaries, anti-money laundering compliance officers, and virtual currency business projects. It also needs to be reviewed and signed by an accountant.
As of March 1st, 25 virtual currency platform operators have completed the Declaration of Compliance with Anti-Money Laundering Regulations.
It is reported that in the future, if individual currency traders provide virtual currency transaction services without complying with the declaration, the Ministry of Justice will take action to sanction them. The initial proposed amendment is expected to impose a maximum penalty of two years’ imprisonment. Additionally, if currency traders are found to be involved in fraud or money laundering, they may face separate punishments.
