The Financial Crimes Enforcement Network (FinCEN) is a bureau of the United States Department of the Treasury that collects and analyzes information about financial transactions in order to combat domestic and international money laundering, terrorist financing, and other financial crimes.
According to the news release on 18th April 2019 by FinCEN, The Financial Crimes Enforcement Network (FinCEN) has evaluated “civil money penalty” against Eric Powers for breaching Bank Secrecy Act’s (BSA) registration, program, and reporting requirements.
Eric Powers is a crypto trader based in California. Mr. Powers did not register as a money services business (MSB), and he also failed to furnish the requirements like written policies and procedure which is necessary for fulfilling BSA’s needs. Eric worked as a peer-to-peer exchanger of convertible virtual currency. Money transmitters are obliged to follow and operate within the BSA’s laws and are also required to register themselves with FinCEN, executing Anti-Money Laundering (AML) programme, and maintaining certain other documents.
As per the FinCEN’s assessment, from December 2012 to September 2014,
a total of 1,700 transactions were conducted by Powers as a money transmitter. Powers also advertised his services on peer-to-peer websites like bitcointalk.org and many more. Out of 1700, over 200 transactions were conducted without filing a CTR, and the transactions included real currency exchange of total worth of more than $10,000.
According to Kenneth A. Blanco, the director at FinCEN, the same duties under the BSA will apply to the money transmitters no matter what is their size. He further added Powers already knew the about the responsibilities and obligations but deliberately didn’t follow them. He remarked:
“Such failures put our financial system and national security at risk and jeopardize the safety and well-being of our people, as well as undercut responsible innovation in the financial services space.”
Eric Powers confessed the violations by saying that he made transactions either personally or by exchanging money through the mail. Eric never filed the suspicious transactions with SAR that stands for Suspicious Activity Reports. He also did illegal activities at marketplace “Silk Road.” As a result of which, the U.S. regulatory has commanded Mr. Eric Powers to pay a penalty of $ 35,000.