The Financial Intelligence Unit (FIU) in Cyprus anticipates a surge in Suspicious Transaction Reports (STRs) for cryptocurrencies, a consequence of the island’s implementation of regulations governing the digital asset industry. In 2021, the Cyprus Securities and Exchange Commission (CySEC) introduced directives aimed at overseeing the activities of Crypto Asset Service Providers.
The Inaugural Report from Cypriot FIU
As per the initial Strategic Analysis Report for the years 2020 to 2023 released by the Cypriot FIU, MOKAS, there were 27 instances of suspicious transactions involving cryptocurrencies reported in 2022. This marked a notable increase from 20 and 19 reported in the preceding two consecutive years.
STRs Submitted Over the Years
The report sheds light on trends related to money laundering and terrorist financing, highlighting patterns involving cryptocurrencies, fraud, corruption, tax evasion, and human and narcotics trafficking.
“This report delves into trends and common practices identified in STRs and SARs received from reporting entities during 2020-2022, Requests and Spontaneous Disclosures from foreign FIUs, as well as Requests from Cyprus Police Authorities and from the Cyprus Customs and Excise Department,” the report specified.
Ongoing Concerns
Cryptocurrencies remain a central focus of the report, emphasizing their predominant use as a payment method on the dark web. The report also reveals that criminals are increasingly concealing the origin of cryptocurrencies through the use of mixers.
Rising Incidents of Fraud
Additionally, the agency has observed a growing trend in fraud based on the submitted suspicious reports. In 2022, there were 242 reported incidents, signaling an increase from 259 and 334 in the preceding years, respectively.
Source: https://www.law.gov.cy/law/mokas/mokas.nsf/All/92E2EFF8D41BE8F4C2258A7B0024ED65/$file/STRATEGIC%20ANALYSIS%20REPORT%202020-2022.pdf?OpenElement