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- Ethiopia Moves Towards Legal Framework For CBDC Launch
- Monaco Faces Potential Greylisting By FATF
- FinCEN Issues New Advisory On Procurement Of Fentanyl Precursors
- Liechtenstein Regulator Publishes Guidance On MiCA, DORA Compliance
- Iran鈥檚 CBDC Cleared For Soft Launch In July
- Evolve Bancorp Penalised In US For Fintech Risk Management Failures
Ethiopia Moves Towards Legal Framework For CBDC Launch
Ethiopia鈥檚 Council of Ministers has two draft bills that could pave the way for the launch of a central bank digital currency (CBDC).
Earlier this month, the council approved the National Bank Ethiopia (NBE) Proclamation and the Banking Business Proclamation, both of which will now be referred to the House of Representatives for review.
The draft NBE Proclamation establishes a 鈥渓egal framework for introduction of central bank digital currency, as necessary鈥.
In November 2023, the NBE announced that it had partnered with German currency solutions firm Giesecke+Devrient on exploring a potential CBDC.
An Ethiopian CBDC would be the second CBDC to go live in Africa, after Nigeria鈥檚 e-naira.
Monaco Faces Potential Greylisting By FATF
The Principality of Monaco is at risk of being added to the international "greylist" for money laundering, according to .
Despite recent improvements to financial transparency, Monaco remains under scrutiny, primarily due to substantial illicit money flows originating from neighbouring Italy and France.
The principality's real-estate sector and casino industry have been identified as key vulnerabilities.
A by Moneyval in 2023 highlighted several shortcomings, notably deficiencies in Monaco's judicial system.
The prospect of greylisting for Monaco has the potential to trigger adverse economic repercussions, such as heightened regulatory scrutiny for firms operating in the microstate and a possible downturn in investment.
FinCEN Issues New Advisory On Procurement Of Fentanyl Precursors
The US Financial Crimes Enforcement Network (FinCEN) has published a 鈥渦rging vigilance鈥 of payments destined for fentanyl precursor suppliers.
As the opioid epidemic worsens, the advisory offers a follow-up to FinCEN鈥檚 on illicit financial schemes related to the trafficking of fentanyl and synthetic opioids.
The latest advisory highlights how Mexico-based transnational criminal organisations (TCOs) purchase fentanyl precursor chemicals, pill presses, die moulds and other manufacturing equipment from suppliers in China.
These payments may be conducted in single or multiple transactions from Mexico and the US, and may be structured through multiple senders and beneficiaries to evade Bank Secrecy Act (BSA) reporting requirements, the advisory notes.
FinCEN has identified the use of shell and front companies; money transfers through banks, money services businesses (MSBs), and online payment processors; and payments in virtual currency as financial typologies associated with Mexico-based TCOs.
Separately, the US Treasury has also imposed on eight 鈥渢op leaders鈥 of Mexico鈥檚 La Nueva Familia Michoacana drug cartel.
Liechtenstein Regulator Publishes Guidance On MiCA, DORA Compliance
The Liechtenstein Financial Market Authority (FMA) has guidance pages for financial intermediaries on two significant and incoming EU regulations: the Markets in Crypto-Assets (MiCA); and the Digital Operational Resilience Act (DORA).
The guidance for MiCA aims to help financial companies prepare for the regulation's implementation, which is due to be February 1, 2025.
This guidance covers regulated activities, the relationship between crypto-asset services and the country's Token and Trusted Technology Service Provider Act (TVTG), and the interplay between MiCA and Directive 2014/65/EU on Markets in Financial Instruments (MiFID II).
For DORA, the guidance is designed to ready financial companies for its future implementation. It provides updates on recent developments, answers frequently asked questions and outlines the framework and reporting requirements.
The exact date for DORA's entry into force in Liechtenstein is yet to be determined, pending decisions related to its European Economic Area (EEA) membership.
Iran鈥檚 CBDC Cleared For Soft Launch In July
The Central Bank of the Islamic Republic of Iran (CBI) has that the digital rial, a retail central bank digital currency (CBDC), will be launched into circulation on a limited basis in July.
Initially, the digital rial will launch exclusively on Kish Island, a holiday resort and free trade zone in the Persian Gulf, which is home to about 140,000 residents.
The digital rial will be available to both Iranian nationals and foreign tourists, and can be used for person-to-merchant (P2M) payments using a QR code.
The CBI said the launch of the digital rial follows several periods of experimentation supported by the country鈥檚 commercial banking sector, beginning in 2021.
It also said the launch of the digital rial will lay the groundwork for a modern digital economy in Iran and will serve the payments needs of merchants and consumers.
Evolve Bancorp Penalised In US For Fintech Risk Management Failures
The US Federal Reserve Board has an enforcement action against Evolve Bancorp for deficiencies in its anti-money laundering (AML), risk management and consumer compliance programmes.
Evolve partners with fintechs who provide access to banking products and services to Evolve鈥檚 end customers.
Examinations conducted in 2023 found that Evolve engaged in 鈥渦nsafe and unsound鈥 banking practices by failing to have in place an effective risk management framework for those partnerships.
In addition, Evolve did not maintain an effective risk management programme or controls sufficient to comply with AML and laws protecting consumers.
The Federal Reserve Board is requiring the bank to improve its policies and programmes in those areas, in addition to requiring other remedial improvements.
Evolve must implement appropriate oversight and monitoring of its fintech partnerships and enhance its record-keeping for compliance purposes.
