Cryptocurrency and Other New Forms of Financial Technology
Potential Terrorist Financing Concerns and Liability
June 25, 2021
As cryptocurrency has become increasingly mainstream, it is important for banks and other financial institutions to consider the evolving dynamics relating to the use of such services by terrorist and other illicit groups.
Indeed, while there certainly are benefits to using virtual currency, the relevant legal framework for combating terrorist funding creates potential areas of liability, particularly under the Anti-Terrorism Act (ATA) and the Justice Against Sponsors of Terrorism Act (JASTA). These considerations are important for companies and banks that provide services related to virtual currency, but also are relevant to any company that could be the target of ransomware attacks since attackers may be sanctioned entities or have ties to terrorism.
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