FATF’s Report Says Qatar Not Actively Banning Crypto Since 2019

Key Points:

• The FATF has encouraged Qatar Central Bank to be more aggressive in identifying and penalizing virtual asset service providers (VASPs) that violate the cryptocurrency ban.
• Even though 2,007 transactions were denied and 43 accounts were terminated, no official fines were imposed.
• The head of QCB has mentioned the potential advantages of speedier payments and is looking at a digital riyal.

According to a report released on Wednesday by the global anti-money laundering authority FATF, Qatar has taken practically no action against cryptocurrency firms that breached the prohibition declared in 2019.

In a report accusing Qatar of being too lenient on terrorist funding, the Financial Action Task Force (FATF) encouraged the Qatar Central Bank (QCB) to more aggressively investigate and discipline Virtual Asset Service Providers (VASPs) that violate its crypto prohibition.

Despite the fact that 2,007 transactions were denied and 43 accounts were terminated, no official fines were imposed.

“Qatar has made positive and sustained progress in collecting beneficial ownership information for its unified register which is close to completion. However, there are still not sufficient controls to ensure that the information collected remains accurate and up-to-date,” the report said.

“In a second case, a foreign VASP licensed in a neighbouring country claimed to be licensed to offer services in Qatar in May 2022. QCB contacted the foreign supervisor to clarify that the VASP did not have a license and released a public statement to clarify this. However, no formal sanctions have been applied on a natural or legal person for contravening the prohibition,” it added.

Despite being less crypto-friendly than neighbors such as the UAE, the QCB governor has highlighted the potential advantages of speedier payments and is investigating a digital riyal.

Qatar is a tiny but prosperous nation with a mostly expatriate workforce. Despite having low internal crime rates, the nation is vulnerable to money laundering concerns from smuggling, fraud, drug offenses, and corruption.

With its nationals targeted for fundraising both at home and abroad, the country confronts a significant terrorist funding danger. The country has established a risk-based strategy to assess money laundering and terrorist funding threats, as well as financial sector regulation. Non-financial sector risk-based oversight is improving, but only slowly.

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Harold

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