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Law360: DOJ Cyber Task Force Issues Crypto Enforcement Blueprint

October 08, 2020

O’Melveny partner Laurel Loomis Rimon is quoted in this article, which discussed the US Department of Justice’s new report on digital currency enforcement. The publication noted that the report joins other agencies’ efforts to give financial instructions greater clarity around the responsible management of digital currencies and what constitutes a violation of federal law.

“While the cryptocurrency industry has been working hard on building out anti-money laundering compliance practices, these two DOJ announcements are a sober reminder of the seriousness of these requirements,” said Rimon, former Head of Litigation for DOJ’s money laundering section.

She also noted that the report showed a shift from the early days of DOJ cryptocurrency enforcement, when the agency occasionally “faced headwinds” on cases from financial regulators including the US Securities and Exchange Commission, the Commodity Futures Trading Commission, and agencies within the US Department of the Treasury—and added that the DOJ appeared to be seeking to work with state authorities, as well.

“Given the variance and complexities in the state licensing regime and the difficulties in restricting an online customer-base, blockchain-based financial institutions complying with federal requirements could still face potential criminal exposure for failures to comply with state laws,” Rimon said. “And the Justice Department’s report signals its willingness to push the envelope on its extraterritorial jurisdiction for cryptocurrencies.”

Law360 subscribers can read the full article here.