Pakistan Government To Ban Cryptocurrency Trading
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Pakistan’s FIA (Federal Investigation Agency) has announced that they plan on obtaining a court order from the PTA to block cryptocurrency trading websites. The government is stated to be doing so as part of their efforts against fraud and money laundering.
The Director-General of the FIA, Dr. Sanaullah Abbasi, met with State Bank Pakistan’s Cyber Crime Circle Office to discuss current digital security issues and how they can work together more closely going forward.
As per the FIA chief, The SBP officials presented a mechanism to regulate crypto platforms.
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The SBP team informed the participants that new regulations for cryptocurrencies would be submitted soon under orders from the Sindh High Court.
Pakistan’s FIA Deem Cryptocurrencies An Insure Way To Transact Business
Law experts have expressed their concerns over cryptocurrencies, calling them an insecure and fraudulent way to transact business.
“Crypto has given a new dimension to fraud,” said Abbasi, adding that it would also connect legal experts for help with fraud issues arising out of this technology.
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The director-general of FIA has pointed out that cryptocurrency is legal in many countries but banned or restricted in some for valid reasons. He observed they were primarily concerned about fraud and money laundering aspects when deciding whether to allow crypto platforms’ use.
The lack of laws to tackle crypto has been raised in meetings earlier this week. For example, there are no sections under the Remittance Act 1947 (FERA), Prevention Of Electronic Crimes Act 2016, Foreign Exchange and Anti-Money Laundering Act 2010 (AMLA).
Only a few times, the action was taken by Cyber Crime Wing under section-23 of FERA and AMLA. This is an act that law enforcement agencies use against cybercriminals who have been caught red-handed breaking into information systems to commit financial crimes such as mortgage scams or stealing funds from customers’ accounts at ATMs that operate on these networks.
The Financial Action Task Force is yet to issue any regulations for Virtual Asset Service Providers (VASP) following their meeting on the matter. The lack of a regulatory framework leaves many questions unanswered, including what steps VASP will have to take if caught doing illegal or inappropriate, such as terrorism financing?
The Pakistani regulatory body, the Securities Commission of Pakistan (SECP), says it will treat virtual currencies like stocks to adopt “a prohibited approach.”
The finance ministry has published an advisory to avoid dealing with digital money, initial coin offerings, and other such crypto-based projects.
The FIA director general Abbasi announced against those involved in a scam where people were being cheated. He revealed data collection on possible suspects to ensure no more victims will fall prey.
The Financial Action Task Force (FATF) is moving to investigate a $100 million cryptocurrency scam after 11 popular bitcoin exchange apps were taken off of their platforms, defrauding Pakistani investors.
In recent development, the FIA arrested “Dr. Zafar” five months ago for deceiving Pakistani citizens through cryptocurrency schemes.
Just yesterday, on Jan 20th, 2022, Federal Investigation Agency (FIA) requested Pakistan Telecom Authority (PTA) to ban over 1600 cryptocurrency websites. The ministers say the move is an effort to regularize cryptocurrency.
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