Taiwan’s Legislative Yuan has recently passed a law that amends the country’s Anti-Money Laundering legislation to include digital assets in an effort to combat fraud and protect victims. This law now requires virtual asset service providers (VASPs) in the region to adhere to AML policies. Firms looking to offer virtual asset services or third-party payment services in Taiwan must establish an AML system and report their capacity, or else face hefty fines up to 5 million New Taiwan Dollars ($153,000) and potential prison sentences of up to two years.
The new laws are aimed at strengthening fraud prevention operations and combating fraud rings in various sectors such as finance, telecommunications, and the digital economy. Virtual asset service providers are now required to monitor transactions and report any suspicious activity involving digital assets to law enforcement agencies. An inter-bank inquiry mechanism has been established to verify these transactions and freeze funds to prevent further illicit activities. Additionally, digital asset platforms must promptly return any remaining cryptocurrencies when notified by authorities, and service providers are exempt from confidentiality obligations and liability in such situations.
Moreover, in a bid to further protect consumers, the Legislative Yuan has also prohibited ads that might be linked to fraudulent schemes, especially in light of the rise of crypto crimes using platforms like X and Instagram to lure users and steal their digital assets. The move comes as Taiwan Mobile, a leading telecommunications provider, acquired a cryptocurrency exchange and became the second firm to be licensed as a virtual asset service provider in Taiwan. This suggests a growing interest in cryptocurrency services in the region and highlights the importance of regulatory measures to prevent financial crimes and protect investors.
It is important to note that the information provided in this article is for informational and educational purposes only and does not constitute financial advice. Readers are advised to exercise caution and conduct their own research before taking any action related to the content, products, or services mentioned. Coin Edition, the source of this information, holds no responsibility for any losses incurred as a result of the utilization of the information presented. As regulations around digital assets continue to evolve, it is crucial for virtual asset service providers to stay compliant with the law and implement robust AML systems to prevent financial crimes and protect consumers’ rights.
