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Financial Action Task Force Updates DeFi Guidance Amidst Sector Growth

Financial Action Task Force Updates DeFi Guidance Amidst Sector Growth

In July 2026, the Financial Action Task Force (FATF) released a 'Targeted Report on Regulatory Challenges from Decentralised Finance (DeFi)', updating its 2021 guidance to address the rapid growth and evolving risks in the DeFi sector. The report clarifies the application of FATF Standards to DeFi arrangements, identifies implementation gaps across jurisdictions, and offers recommendations for regulators, DeFi participants, and Virtual Asset Service Providers (VASPs) to enhance Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) oversight. The report emphasizes that DeFi arrangements fall under FATF Standards when a natural or legal person exercises control or significant influence, while truly decentralized protocols remain outside their scope. It also highlights that few jurisdictions have assessed DeFi-related risks or established dedicated supervisory frameworks, despite the sector's growth.
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Liechtenstein Data Breach Exposes Security Flaws in EU Financial Transparency Systems

Liechtenstein Data Breach Exposes Security Flaws in EU Financial Transparency Systems

On August 3, 2026, Liechtenstein confirmed a significant data breach in its national register of beneficial owners, where attackers exfiltrated records of approximately 31,000 legal entities. This breach raises critical questions about the security of centralized financial transparency databases mandated by EU regulators. The register, established to enhance transparency and combat financial crime, contains sensitive information about the real owners of companies and trusts. The breach highlights vulnerabilities in the system, as the centralized aggregation of data creates a high-value target for cyberattacks. The incident has prompted a crisis response from Liechtenstein's government, emphasizing the political and institutional weight of the breach.
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Financial Action Task Force Places Nepal on Grey List, Impacting Cross-Border Transactions

Financial Action Task Force Places Nepal on Grey List, Impacting Cross-Border Transactions

In February 2025, the Financial Action Task Force (FATF) placed Nepal on its grey list due to concerns about money laundering, terrorism financing, and informal financial flows, particularly through the illegal remittance system known as hundi. This designation marks Nepal as a high-risk jurisdiction, leading to increased scrutiny on cross-border financial transactions. The Nepal Rastra Bank (NRB) has intensified enforcement against unauthorized forex activities, including hundi and cryptocurrency transactions, to address these issues. The grey listing has significant implications for Nepal's international credibility and banking relationships, as it signals potential vulnerabilities in the country's financial system.
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FATF Warns DeFi Sector Vulnerable to Money Laundering and Fraud

FATF Warns DeFi Sector Vulnerable to Money Laundering and Fraud

The Financial Action Task Force (FATF) has issued a warning regarding the increasing use of decentralized finance (DeFi) by fraudsters, ransomware operators, and money laundering networks. According to a recent report, 93% of the 143 jurisdictions surveyed have not implemented FATF's anti-money laundering standards for DeFi. The report highlights vulnerabilities in the DeFi sector, such as permissionless access and limited user identification, which make it susceptible to criminal exploitation. Notably, two cyberattacks attributed to North Korea in April 2026 accounted for 76% of virtual asset hacking losses this year, totaling over $570 million. FATF President Giles Thomson emphasized the need to prevent the misuse of emerging technologies while supporting their legitimate use.
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Feedzai Enhances AI-Native Financial Crime Prevention to Protect Consumers

Feedzai Enhances AI-Native Financial Crime Prevention to Protect Consumers

Feedzai Enhances AI-Native Financial Crime Prevention to Protect Consumers
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Capital One Closes Trump Organization Accounts Citing Money-Laundering Concerns

Capital One Closes Trump Organization Accounts Citing Money-Laundering Concerns

Capital One Closes Trump Organization Accounts Citing Money-Laundering Concerns
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Paul Hastings Expands Global Finance Practice with New Partner Brad Weyland

Paul Hastings Expands Global Finance Practice with New Partner Brad Weyland

Paul Hastings Expands Global Finance Practice with New Partner Brad Weyland
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Capital One Closed Trump Accounts in 2021 Over Money Laundering Concerns

Capital One Closed Trump Accounts in 2021 Over Money Laundering Concerns

Capital One Closed Trump Accounts in 2021 Over Money Laundering Concerns
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FinCEN Imposes Record $125 Million Penalty on UBS for Bank Secrecy Act Violations

FinCEN Imposes Record $125 Million Penalty on UBS for Bank Secrecy Act Violations

FinCEN Imposes Record $125 Million Penalty on UBS for Bank Secrecy Act Violations
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UBS fined $125 million by US regulators for money laundering violations

UBS fined $125 million by US regulators for money laundering violations

By Jonathan Stempel NEW YORK, Aug 3 (Reuters) - UBS was fined $125 million by U.S. regulators on Monday for violating the Bank Secrecy Act, the largest civil fine ever against a broker-dealer for violating the main U.S. anti-money laundering law. The U.S.
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Citigroup Faces Increased Regulatory Scrutiny Amid Compliance Challenges

Citigroup Faces Increased Regulatory Scrutiny Amid Compliance Challenges

Citigroup Faces Increased Regulatory Scrutiny Amid Compliance Challenges
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Singapore's MAS Sets AML/CFT Guidelines for Digital Payment Token Providers

Singapore's MAS Sets AML/CFT Guidelines for Digital Payment Token Providers

The Monetary Authority of Singapore (MAS) has released an Information Paper detailing its expectations for digital payment token service providers (DPTSPs) regarding anti-money laundering and countering the financing of terrorism (AML/CFT) measures. Published on July 13, 2026, the paper outlines supervisory expectations in areas such as risk assessment, customer due diligence, and ongoing monitoring. DPTSPs are required to conduct a gap analysis and implement necessary changes under the oversight of their boards and senior management. The paper emphasizes the need for effective risk detection and mitigation strategies to address the unique challenges posed by the pseudonymous and cross-border nature of digital payment transactions.