Representatives of the State Financial Monitoring Service of Ukraine took part in activities within the framework of the project “Innovative policy solutions to mitigate money laundering risks of virtual assets”

With the assistance of the OSCE and the United Nations Office on Drugs and Crime (UNODC), during November 10-11 and December 5-7, 2022 in the city of Vienna (Republic of Austria), representatives of the State Financial Monitoring Service of Ukraine together with the representatives of other state authorities of Ukraine took part in the events organized within the framework of the off-budget project “Innovative policy solutions to mitigate money laundering risks of virtual assets”. The main purpose of the events is the presentation of the above-mentioned project, as well as the discussion of the current state of the problem of money laundering through virtual assets.

The fight against money laundering, including the criminal use of virtual assets and cryptocurrencies, is one of the key priorities of the OSCE and the UNODC. To counter the threats posed by money laundering to national, regional, global security and stability, the OSCE states have agreed to a series of commitments that support the efforts of relevant authorities to prevent, detect and stop money laundering and ML-related predicate offences.

This project will directly address the existing but poorly managed risks associated with the use of virtual assets for criminal purposes and the circumvention of international sanctions regimes. The ultimate goal of the project is to build the capacity of national authorities to resist threats, vulnerabilities, risks and the consequences of their manifestation in the sphere of virtual assets turnover.

The project will be implemented in Ukraine, Georgia and Moldova – countries with a steadily growing market of virtual assets and an aggressively growing sector of illegal cryptocurrency mining. The project will be implemented jointly with the UNODC within the framework of the Joint OSCE-UNODC Action Plan for 2022-2024, using practical training on virtual assets developed by the UNODC. This project initiative will primarily be aimed at helping countries to regulate virtual assets, establishing joint work between state authorities and law enforcement agencies in order to improve efficiency, as well as strengthening the institutional capacity of law enforcement agencies, the FIUs and other participants involved in the investigation of crimes with virtual assets.

Also, one of the tasks of the project is to create a network of experts and trainers who in the future will be able to transfer the acquired skills and knowledge within their countries. In this context, significant attention of the participants was drawn to the presentation of the UN Learning Management System (LMS), which will serve as a designer, with the help of which it is planned to deploy a comprehensive training program for specialists, analysts, researchers, regulators and investigators in the field of virtual assets turnover (lms.gpml-crypto.org).

Representatives of the SFMS, as part of the participation in the events that took place in November-December of this year, were actively involved in the discussions of defining the taxonomy of virtual acts, regulatory activities of the virtual assets market, sectoral risk assessment of the virtual assets sector, current tools and technical opportunities for conducting an investigation of virtual transactions and covering a review of international and national legislation in the field of virtual assets.

In addition, the representatives of the SFMS presented complex developments and acquired experience in conducting the National Risk Assessment, a component of which are sectoral risk assessments. Also, the participants of the event were presented with the methodology of preparing for the relevant risk assessments, which was prepared by the State Financial Monitoring Service of Ukraine, and the results of work with it.

In order to further develop the national anti-money laundering system, the SFMS together with the OSCE, the UNODC and other interested participants will continue active cooperation within the project “Innovative policy solutions to mitigate money laundering risks of virtual assets”.