Well, most of them are traceable. The lottery win will be a bank transfer and there'll be no problem there as the bank will know exactly where the money came from to fund the lottery account. The money from Coinbase less clear, while the transfer request to the bank will come from Coinbase's bank, who and where did it come from before that? As Coinbase are an exchange, they're just a middleman in this, neither the source nor destination.
Irish banks, Bitcoin and Anti money laundering rules
- Thread starter Leo
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Well, most of them are traceable. The lottery win will be a bank transfer and there'll be no problem there as the bank will know exactly where the money came from to fund the lottery account. The money from Coinbase less clear, while the transfer request to the bank will come from Coinbase's bank, who and where did it come from before that? As Coinbase are an exchange, they're just a middleman in this, neither the source nor destination.
Brendan Burgess
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Hi Leo
What are the limits which trigger a question or refusal from the bank?
I posted a cheque for £5,000 sterling to my sterling account in Ulster Bank in Newry and was very surprised to get a phone call from them asking me where it came from?
Presumably if someone lodges €1,000 profit from Bitcoin, no questions will be asked.
But if they lodge €1m, it might be refused?
Do they reject the transfer in or do they just ask questions?
Brendan
What are the limits which trigger a question or refusal from the bank?
I posted a cheque for £5,000 sterling to my sterling account in Ulster Bank in Newry and was very surprised to get a phone call from them asking me where it came from?
Presumably if someone lodges €1,000 profit from Bitcoin, no questions will be asked.
But if they lodge €1m, it might be refused?
Do they reject the transfer in or do they just ask questions?
Brendan
TheBigShort
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How will they know? If 50% of lotto tickets sales are by cash? How will they know if a significant proportion of this is not from money illegally obtained elsewhere?
The lottery is just a middleman here too.
This is the latest 'crackdown' story on RTE this morning
https://www.rte.ie/news/2018/0123/935254-skorea_crypto-currency/
Apparently "Local crypto-currency traders will not be allowed to make deposits into their virtual coin exchange wallets unless the name on their bank account matches the account name in crypto-currency exchanges."
If this is the definition of 'crackdown', then it cannot be taken seriously. This is a standard regulatory requirement in most developed countries.
Note: while you've asked an interesting question, it's a criminal offence to assist anyone in circumventing AML / CTF regulations and controls, so it's unlikely that anyone who fully understands the practices in place with any bank, and the legislation, will actually answer it.
Read what was posted last week on AML requirements... that will answer your question there, but do you honestly think anyone is laundering money via lottery tickets?
TheBigShort
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No probably not.
I do know that the Gilligan gang was purported to use bookmakers for laundering drug money, so aren’t on street bookmakers and racecourse bookmakers ideal middlemen for laundering drug money?
The ultimate point being, any cash heavy business is ideal for laundering money. Bitcoin transactions relative to gloval cash transactions are a drop in the ocean. Yet the scare-mongering is centred around bitcoin and not cash – see RTE report above.
Good point. The Central Bank guidelines are published under this site, so it's certainly OK to point those out, but yeah beyond that it might get a little questionable. The links to the right of that page include guidance to financial institutions on what they need to do be compliant with AML legislation along with EU & UN sanctions lists.
Cash is much better for laundering proceeds of crime than bitcoin is.
Firstly, all bitcoin transactions are recorded on a public ledger; so if apprehended, additional instances of laundering are easy to reveal.
Secondly, it is a little cumbersome going from bitcoin to fiat.
It involves using regulated Exchanges that are compliant with KYC, or face-to-face localbitcoins.
The later may be preferable for a criminal gang as it is anon, however it would take more time to exchange money, and would have inconsistencies regarding price and availability, all subject to local demand.
There are security risks too, if a criminal gang is a regular seller on localbitcoins, a single police sting could expose the entire history of laundering.
Cash is still King.
TheBigShort
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From Sept 2017
https://www.irishtimes.com/business...nd-how-come-there-s-so-many-of-them-1.3224402
Not one word of concern for money-laundering.
Im not suggesting these cash buys are dodgy, but if the issue is identifying the source of the cash then these purchases would need to come under serious scrutiny.
On the otherhand, if the cash payments are conducted through the regulated banking system, as is the crypto exchange transactions, and the banks are compliant with AML and KYC requirements (as is an exchange like Coinbase), then it is hard to see the issue is.
Money laundering only becomes an issue if someone is actually laundering money, whether that is through bookmakers, bank, art, property, crypto, casinos, etc...etc...and not because of crypto.
https://www.irishtimes.com/business...nd-how-come-there-s-so-many-of-them-1.3224402
Not one word of concern for money-laundering.
Im not suggesting these cash buys are dodgy, but if the issue is identifying the source of the cash then these purchases would need to come under serious scrutiny.
On the otherhand, if the cash payments are conducted through the regulated banking system, as is the crypto exchange transactions, and the banks are compliant with AML and KYC requirements (as is an exchange like Coinbase), then it is hard to see the issue is.
Money laundering only becomes an issue if someone is actually laundering money, whether that is through bookmakers, bank, art, property, crypto, casinos, etc...etc...and not because of crypto.
Sounds like in Poland they are turning the screws on business bank accounts.
It's more to do with tax compliance and fraud according to the article.
This is a google translate of the webpage:
Would make one think twice about running a business in Poland, even a legitimate one.
If the bank can freeze you out for 72hrs up to 3 months based on whatever qualifies as a suspicious transaction?
Not many businesses have cash in the safe to survive a 3 month freeze on their money.
And no court order or oversight..
It's more to do with tax compliance and fraud according to the article.
This is a google translate of the webpage:
https://www.money.pl/gospodarka/uni...kul/konta-bankowe-kas-banki,29,0,2396701.html
Would make one think twice about running a business in Poland, even a legitimate one.
If the bank can freeze you out for 72hrs up to 3 months based on whatever qualifies as a suspicious transaction?
Not many businesses have cash in the safe to survive a 3 month freeze on their money.
And no court order or oversight..
Why we need bitcoin, people ask...
You do know all those transactions had to satisfy the same AML requirements? And none of them involved anyone walking into an estate agent was a bag full of cash? There's no mention of a concern because there's full traceability.
TheBigShort
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So if I sell a house for €1m and I receive funds by AIB cheque, through a solicitor, and deposit that cheque into BoI, everything is ok.
But if I sell bitcoin for €1m and I receive funds from AIB electronically, via Coinbase EU bank a/c, and deposit those funds from Coinbase to my BoI account, everything is not ok?
To echo what Andreas Antonopoulos says when he meets with government Regulators:
Nobody is questioning their right to Regulate bitcoin within their jurisdiction.
The question is how can they regulate bitcoin.
Bitcoin is not going to change it's rules to let [insert country here] government have some sort of overarching power over it.
Nobody is questioning their right to Regulate bitcoin within their jurisdiction.
The question is how can they regulate bitcoin.
Bitcoin is not going to change it's rules to let [insert country here] government have some sort of overarching power over it.
Wouldn't just removing cash from the system be the most definitive response to money laundering?
The amount of bitcoin used for money laundering is tiny, less than 1 percent of bitcoin transactions according to a recent report.
There's much more illegal activity involving cash and it has always been that way.
To really take-on money laundering, surely it would be more effective to withdraw notes from circulation and force all transactions to run through banks.
THEN we'd be safe, right?
The amount of bitcoin used for money laundering is tiny, less than 1 percent of bitcoin transactions according to a recent report.
There's much more illegal activity involving cash and it has always been that way.
To really take-on money laundering, surely it would be more effective to withdraw notes from circulation and force all transactions to run through banks.
THEN we'd be safe, right?
All explained last week, and a number of times since.
TheBigShort
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Not very well it has to said. In fact, the hyperbolic, scare-mongering "crackdown" stories were better explained to you.
Maybe on the first count, looks like it'll take someone with more patience of aptitude in education to get across the meaning of source. But I didn't need any explanation on the 'crackdown' stories, I understand the technology and regulatory frameworks, so it's all pretty straightforward. For example, I didn't read the RTE report linked above as any form of crackdown on Bitcoin as others seem to have, it's simply a crackdown on anonymous banks accounts, and that just brings more of their regulatory framework into line with the rest of the world. RTE being RTE, throw in the tenuous link to Bitcoin as click-bait.
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TheBigShort
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Well the original source for all cash is the central banks, so from the get-go the source of all money is dubious
On the otherhand, considering the RTE report earlier which is clearly about crypto-currency exchanges (I counted the phrase 'crypto currency' seven times before stopping) and not about 'anonymous bank accounts'
I think you had better read the report, to understand what it is saying, before being so dismissive.