AML Certifications CCAS Passing Score

PEPs require enhanced scrutiny under FATF Recommendation 12, including senior management approval and source of funds verification.

The EU’s Markets in Crypto-Assets Regulation (MICA) applies specifically to:

Electronic Money Tokens (B): Tokens that fulfill the definition of electronic money under the E-Money Directive.

Cryptoassets (D): Broad category including digital representations of value that are not covered by existing financial services legislation.

Asset-Referenced Tokens (E): Tokens that purport to maintain a stable value by referencing one or several assets.

Meme coins (A) and privacy coins (C) are not separately classified under MICA but may fall under broader cryptoasset categories subject to other regulations.

Red flags related to anonymity include transactions where virtual assets are cashed out at exchanges from peer-to-peer hosted wallets with no clear business rationale. Such behavior indicates attempts to obscure the origin or destination of funds, characteristic of laundering activities.

Executing high-value transactions after inactivity (A) or frequent transfers to known VASPs (C) may be suspicious but are less directly linked to anonymity. Exchanging at a loss (D) is a different type of red flag.

FATF’s red flag indicators list (2021) highlights (B) as a key sign of anonymity-related risk.

Blockchain’s transparent ledger enables investigators to trace transaction histories indefinitely, aiding ML/TF detection.