At the beginning of November, the Financial Services and the Treasury Bureau (“FSTB”) released a public consultation seeking views on legislative proposals to enhance anti-money laundering and counter-terrorist financing (“AML/CTF”) regulation in Hong Kong for virtual asset service providers (VASPs) and dealers in precious metals and stones (DPMS).
As part of its goal to enhance these regulations, the FSTB cites that licensed VASPs must “mitigate the risks posed to investors arising from system failure, security breach or market manipulation.”
They can prevent abuse by “implementing written policies and controls for the proper surveillance of activities on its platform(s) in order to identify, prevent and report any market manipulative or abusive trading activities.”
ViP: In order for a VASP to comply with AML/CTF regulations, they need a purpose-built surveillance solution tailored to their unique facts and circumstances. This is especially important as it relates to different jurisdictions around the world, including Hong Kong. Validus can generate easily customizable reports, which can evaluate suspicious transactions (i.e. deposits or withdrawals), abnormal trading activity and identify asset movement to/from high-risk countries.