Irish cabinet approves bill to prevent use of cryptocurrencies for money laundering and terrorism financing purposes

The Irish government is making efforts to implement stricter laws to fight money laundering and terrorism financing activities using cryptocurrencies.

According to the Irish Times, the Cabinet has approved a bill that aims to give effect to the Fifth EU Anti-Money Laundering Directive.

The European Parliament agreed to the text of the fifth AML directive on 19 April 2018. Soon after, the Council also adopted the directive. Among other things, the directive aims to “prevent risks associated with the use of virtual currencies for terrorist financing and limiting the use of pre-paid cards.”

According to Irish government news service Merrion Street, the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Bill 2019, proposed by the Minister for Justice and Equality Charlie Flanagan, has been approved by the Cabinet.

The bill transposes many of the provisions of the Fifth AML Directive. It includes restrictions on the use of “virtual currencies for terrorist financing and limiting the use of pre-paid cards” and strengthens safeguards for financial transactions to and from “high-risk third countries”.

“This is another important piece of legislation for tackling money-laundering. The reality is that money laundering is a crime that helps serious criminals and terrorists to function, destroying lives in the process. Criminals seek to exploit the EU’s open borders and EU-wide measures are vital for that reason. Ireland strongly supports the provisions in the Fifth EU Money Laundering Directive,” Flanagan said.

If passed, the bill will require banks and financial institutions to carry out stricter due diligence before they take on new clients. In addition, credit and financial institutions will be prohibited from creating anonymous safe deposit boxes.