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Two US lawmakers have opposed the Division of Justice’s (DOJ) try and broaden the definition of a money-transmitting enterprise.
In a Might 9 letter to US Legal professional Basic Merrick Garland, Senators Cynthia Lummis and Ron Wyden argued that the DOJ’s broad interpretation might criminalize non-custodial crypto asset software program companies.
In line with the lawmakers:
“The DOJ’s unprecedented interpretation of this statute within the context of non-custodial crypto asset software program companies contradicts the clear intent of Congress and the authoritative steerage of the Division of the Treasury’s Monetary Crimes Enforcement Community (FinCEN).”
DOJ’s argument
In April, the DOJ argued that the crypto mixer functioned as an unlicensed cash transmitter as its rebuttal to Twister Money’s developer Roman Storm’s movement for dismissal.
In its movement, the DOJ argued that controlling funds was not a prerequisite for such classification. In accordance to the Justice Division:
“The definition of ‘cash transmitting’ in Part 1960 doesn’t require the cash transmitter to have ‘management’ of the funds being transferred. The definition exends to ‘transferring funds on behalf of the general public by any and all means.”
Congress intent
The lawmakers consider that the DOJ’s place was fallacious as Congressional intent for the regulation requires that an organization should have “direct receipt and management of belongings” to qualify as a money-transmitting enterprise.
The lawmakers additionally cited the Financial institution Secrecy Act and several other FinCEN laws to assist their argument in opposition to the DOJ’s stance.
The senators additionally acknowledged :
“Non-custodial crypto service suppliers can’t be labeled as cash transmitter companies as a result of customers of such companies retain sole possession and management of their crypto belongings.”
The lawmakers urged the DOJ to not divert “from the clear, logically sound, and well-established definition of “cash transmission” established by FinCEN.” They added:
“Subjecting builders of non-custodial crypto asset software program to potential legal legal responsibility as unregistered cash transmitters contravenes the well-established interpretation of this provision and can solely serve to stifle innovation and shake confidence within the DOJ’s respect for the rule of regulation.”
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