Facebook crypto riding shotgun against money laundering

US Treasury Secretary Steve Mnuchin on Monday voiced serious concern that Facebook Inc’s proposed Libra cryptocurrency could be misused for money laundering, adding to the growing regulatory scepticism of the social media company’s digital asset plans.

The Treasury Department has warned Facebook that it must enact proper safeguards against illicit use such as money laundering, he said at a White House press conference.

“Treasury has been very clear to Facebook ... and other providers of digital financial services that they must implement the same anti-money laundering safeguards in countering the financing of terrorism as traditional financial institutions,” Mnuchin said.

His comments came a day before Facebook’s top official overseeing the launch of its Libra cryptocurrency, David Marcus, was scheduled to tell US lawmakers the company would not launch the digital currency until regulatory concerns and approvals are fully addressed, according to prepared testimony posted by the Senate Banking Committee.

Mnuchin said Facebook’s Libra would have to convince financial regulators it has high privacy standards.

He declined to comment on any regulatory timeline for Libra.

The company is a “long way away from” securing approval from US regulators or launching the cryptocurrency in the United States, he said.