The United states Treasury is asking Congressional lawmakers to grants it powers to pursue cyrpto companies overseas that are helping illicit financing of terrorists. One request incudes special jurisdiction over non-U.S. Stablecoin users. The new set of powers that would give the Treasury enforcement and sanctions authority over the crypto sector, beyond American borders.

Deputy Secretary of the Treasury Wally Adeyemo has lobbied senior members of Congress with a proposal he called “a set of common-sense recommendations to expand our authorities and broaden our tools and resources to go after illicit actors in the digital asset space,” according to excerpts from a speech he’s set to deliver on Wednesday in Washington.

“Modes of raising and moving money continue to evolve and many of our authorities have not been updated in decades,” according to the Treasury document sent to lawmakers and obtained by CoinDesk. Terrorist groups – including Hamas – “use new virtual methods to move, store and obfuscate their funding streams. These methods often include the use of evasive cryptocurrency networks and services, including mixers.”

Congress should grant the Treasury “a new secondary sanctions tool” against exchanges that support terrorism, according to the proposal. It could give the government similar powers when targeting virtual asset providers as its long had over correspondent banking accounts and “would account for the technological changes that have rendered highly effective tools in the traditional payments context less effective against cryptocurrencies.”

Lawmakers are also being asked to strengthen the department’s powers under the Bank Secrecy Act (BSA), allowing for the “targeting of cryptocurrency entities and services that facilitate funding for terrorists,” the proposal said. It calls for a new category of financial institutions under the BSA that would include “cryptocurrency exchanges, Virtual Asset Service Providers (VASPs), virtual asset wallet providers, certain blockchain validator nodes and decentralized finance services,” requiring them to meet certain anti-money-laundering demands.

JEFFREY NEWMAN AND HIS FIRM ARE WHISTLEBLOWER LAWYERS THAT HANDLE CASES UNDER THE SEC, CFTC AND FINCEN WHSITLEBLOWER PROGRAMS. HE CAN BE REACHED AT JEFF@JEFFNEWMANLAW.COM OR AT 617-823-3217