Senate meets in bid to 'crack down' on crypto-backed terrorism

The Senate Banking Committee met Thursday to hold a hearing on crypto and how it is being used to fund terrorism in light of reports of crypto-funded terrorism. In his opening statement, Banking Committees Chairman Sherrod Brown (D-OH) highlighted the need to "crack down on the use of crypto to fund terrorism and evade sanctions."

Senator Cynthia Lummis (R-WY) joins Yahoo Finance to discuss the hearing as well as her bill, co-sponsored with Senator Kirsten Gillibrand (D-NY), called The Responsible Financial Innovation Act, which she says will provide additional resources to the Financial Crimes Enforcement Network (FinCEN) and fund studies regarding the use of crypto mixers and tumblers, among other provisions.

Lummis explains the necessity for her bill: "We need to make sure that the Justice Department, when we have known violations, Binance, Tether, and other uses where they have... it's been told to them that their customers are using their platforms for illicit finance, and then they'll take them down for a short period of time, and then those sites go back up. These are the kind of things that need to be policed in the United States by U.S. regulators."

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Video Transcript

RACHELLE AKUFFO: How do you close some of the gaps and the loopholes here that are allowing some of these countries and these users to circumvent sanctions and some of the existing policies?

CYNTHIA LUMMIS: Senator Kirsten Gillibrand and I have a comprehensive bill called the Responsible Financial Innovation Act that would provide additional resources to FinCEN, would call for a study of the use of mixers and tumblers. We also know that Treasury is already doing some good work to begin that effort, regarding the use of mixers and tumblers, to secure anonymity in illicit finance. We need to make sure that the Justice Department-- when we have known violations, Binance, Tether, and other uses where they have-- it's been told to them that their customers are using their platforms for illicit finance. And then, they'll take them down for a short period of time. And then, those sites go back up.

These are the kind of things that need to be policed in the United States by US regulators. The Lummis-Gillibrand Bill will augment those efforts, those resources, and make sure that countries that have the reach of US regulation are complying with the Bank Secrecy Act and the Anti-Terrorism Act. We have a portion of our bill in the National Defense Authorization Act that already passed the Senate. We want to make sure that that part stays in the final product. We've got to get at the illicit finance use of cryptocurrency.

RACHELLE AKUFFO: And certainly, we've cried some international cooperation as well, as some of these transactions essentially borderless. We do appreciate you taking the time to join us, Senator. Cynthia Lummis, Republican Senator of Wyoming. Thank you so much for joining us this morning.

CYNTHIA LUMMIS: My pleasure. Thank you.