Cryptocurrency crime needs to be tackled

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Illegal transactions are difficult to stop as the digital wallets that hold money and the networks themselves are outside Taiwan, a lawmaker said

  • By Yang Cheng-yu and Jake Chung / Staff reporter, with staff writer

Government agencies plan to strengthen cross-departmental efforts to target criminal activities at their source, Prime Minister Su Tseng-chang (蘇貞昌) told lawmakers after New Power Party (NPP) lawmaker Chiu Hsien-chih (邱顯智) raised concerns about , that Taiwanese laws are too conservative in dealing with cryptocurrencies.

The global anti-fraud organization and victims of cryptocurrency scams have criticized Taiwan’s prosecutors and law enforcement officials for being reluctant to contact cryptocurrency exchange platforms for help, Chiu said.

Chiu praised the government’s efforts to combat the recent Cambodia-based fraud rings, but said more needs to be done to enable law enforcement agencies to freeze cryptocurrency transactions, which are a primary method of transferring funds for illegal activities.

Photo: Reuters

The Criminal Investigation Bureau is waiting until this month to file its first-ever request to freeze cryptocurrency transactions, while other countries may already be taking such measures, Chiu said.

The agency reasons that there is no legal basis or precedent for taking such action, he said.

As for the assets the bureau is seeking to freeze, the cryptocurrency exchanges are based offshore and the electronic wallets are not owned by Taiwanese, creating jurisdictional issues and making it difficult to deliver notices, Chiu said, citing bureau officials.

Photo: CNA

However, the journal Criminal Policies and Crime Prevention said last December that transactions using blockchain technology are transparent at all levels and it is possible to track the recipient of the funds, he said.

Cryptocurrency exchanges have shown a willingness to work with law enforcement, Chiu said, citing the example of Binance, the exchange with the world’s largest daily trading volume, which has established a search-and-assist system used by law enforcement.

Binance’s system supports traditional Chinese language searches, he added.

Taiwan’s law enforcement agencies have shown less commitment than cryptocurrency agents in tackling fraud, Chiu said.

Justice Minister Tsai Ching-hsiang (蔡清祥) said the High Prosecution Service is cooperating with cryptocurrency exchanges and can access transaction data.

The Department of Justice runs a staff training program involving overseas training that will assist prosecutors.

Su said the government is striving to ensure that criminal cryptocurrency activity is controlled and regulated.

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