US Senators Propose Bill to Enhance Secret Service’s Authority to Tackle Crypto Crimes

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Ruholamin Haqshanas

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Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

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August 5, 2024 04:15 EDT

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Senators Catherine Cortez Masto of Nevada and Charles Grassley of Iowa have unveiled a new bill to increase the Secret Service’s authority to bolster the fight against cryptocurrency-related crimes.

The bill, dubbed the “Combatting Money Laundering in Cyber Crime Act of 2024,” aims to grant the Secret Service expanded powers to probe cryptocurrency transactions conducted by unlicensed money transmitters and potential frauds targeting US financial institutions.

“The funding of criminal activity through digital assets poses a direct threat to the security and safety of our nation,” Senator Cortez Masto said.

My new bill with @ChuckGrassley gives the Secret Service the tools to investigate criminal organizations using digital assets to evade the law.

The Secret Service plays a critical role in combatting financial crime, and our bill will ensure they can continue to keep us safe.

— Senator Cortez Masto (@SenCortezMasto) August 4, 2024

Legislation Gathers Bipartisan Support

The proposed legislation has garnered bipartisan support.

Senator Grassley claimed that the bill is necessary for stronger threat assessments to root out illicit financial operations that enable money laundering schemes.

“Putting financial activity on federal law enforcement’s radar like this bill does will improve our capacity to anticipate and prevent crimes.”

Recent data from blockchain forensics firm Chainalysis revealed that illicit addresses managed to launder an alarming $22.2 billion worth of cryptocurrencies in 2023.

While this figure is substantial, it marks a notable decline of almost 30% from the previous year’s total of $31.5 billion.

Despite these findings, the US Treasury has underscored that traditional cash transactions, not cryptocurrencies, remain the primary avenue for money laundering activities among criminals in the United States.

The Secret Service, renowned for its role in safeguarding high-profile political figures and investigating financial crimes, has faced increased scrutiny following a recent security lapse that allowed an assassination attempt on a political candidate.

Simultaneously, the US House recently approved the Financial Technology Protection Act, designed to curb illicit cryptocurrency practices while upholding consumer rights.

7 U.S. States Challenge SEC’s Crypto Regulations

As reported, a coalition of seven U.S. states has come together to challenge the Securities and Exchange Commission’s (SEC) regulation of cryptocurrency.

Led by Iowa Attorney General Brenna Bird, the states have filed an amicus brief arguing that the SEC’s attempt to regulate cryptocurrencies constitutes a “power grab” that would stifle innovation, harm the crypto industry, and exceed the agency’s authority.

The coalition includes Arkansas, Indiana, Kansas, Montana, Nebraska, with Oklahoma becoming the latest state to join.

Earlier this year, SEC Commissioner Hester Peirce said that the regulatory agency is currently operating in an “enforcement-only mode” when it comes to the regulation of cryptocurrencies.

Peirce, known for her crypto-friendly stance among the SEC’s five commissioners, acknowledged the burden placed on industry participants who constantly worry about avoiding legal disputes.

“If we had clearer rules, you could focus on building,” she said.

Last week, the SEC closed its three-year investigation into Hiro Systems.

The agency’s conclusion of the investigation comes just a day after it closed a separate case involving stablecoin issuer Paxos, marking another instance where the regulatory body has opted not to pursue enforcement actions against crypto entities.