By Brian Monroe
November 4, 2019
Amr Rashed deeply understands the duality of the nascent but burgeoning cryptocurrency sector.
As Head of International Cooperation for the Egyptian Money Laundering Combatting Unit (EMLCU), he has made it his mission to better understand how criminals, terrorists and money laundering syndicates can use virtual worlds to legitimize sullied funds and even anonymize their very involvement.
But Rashed also wants to ensure financial crime compliance professionals see the big picture when it comes to virtual value, crisscrossing the Middle East and the rest of the globe for more than a decade, teaching that the word crypto is not always synonymous with criminal activity.
Learning the nuances of how crypto and compliance converge is a powerful asset for Rashed, who is also part of the Technical Assistance and Training Working Group (TATWG), for the Egmont Group.
Rashed is part of a small but growing community of public and private compliance professionals, investigators and regulators banding together to identify financial crime vulnerabilities in the crypto sector, with these groups pulling off stunning victories in the space.
In recent years, investigators in the United States, Europe and several Nordic jurisdictions have crushed the largest illicit darknet markets on the Internet, many which took anonymous virtual currencies, related cryptocurrency exchanges that willfully flouted counter-crime compliance practices and, just weeks ago, identified and crushed a site trading in child sexual abuse imagery that used crypto coins to mask users’ payments.
As a gatherer of knowledge tied to a cryptocurrency field still working to better understand itself – and how it can comply with international anti-money laundering (AML) best practices – Rashed is working to position himself as a critical nexus between banking compliance professionals, law enforcement investigators and prosecutors.
“Ongoing learning is the first key, as a trainer in the field, I try to communicate with the largest possible number of banking, law enforcement authorities (LEA) and prosecution professionals to provide a seasoned opinion on cryptocurrencies, and to show that crypto is not a synonym of financial crime in the first place,” he told ACFCS.
Rashed’s passion to identify and counter criminals exploiting cryptocurrencies is only equaled by his zeal to share those battle tactics with other professionals, a mantra that reflects back to him in some unlikely ways.
The most rewarding part of his job is “definitely when I make a difference with helping colleagues in their work,” he said. “Sometimes someone stops me in the street and tells me that s/he made use of our conversation/lecture/chat to learn something new and to solve a mystery case. Only then, I feel very self-fulfilled and I had made a difference.”
It was for those and many other reasons ACFCS chose Rashed as one of the recipients of the association’s inaugural Cryptocurrency Scholarship Program, an initiative coinciding with the association’s “Quarterly Focus” topic, which was cryptocurrency.
After receiving over 300 applications from professionals across 20 countries, ACFCS chose 25 recipients for the scholarships. Those chosen for the scholarship submitted applications with compelling professional and often personal experience related to cryptocurrencies.
The winners come from a wide array of professions, industries and geographic areas, including seasoned compliance professionals at crypto exchanges in the US and Canada, crypto investigators in law enforcement in the US and UK, and traditional financial institutions with a nexus to crypto.
These recipients reflect the diversity of roles, actors and skill sets needed to properly understand and address the financial crime risks in this emerging field.
ACFCS prioritized applicants in regulatory and law enforcement roles, and those still relatively new in their careers.
The scholarship offers complimentary registration for the Certified Financial Crime Specialist (CFCS) certification, the full suite of prep materials, and a year of membership in ACFCS.
To read more about the crypto initiative and find a list of useful resources, click here.
In the prior quarter, ACFCS engaged in a quarterly focus on human trafficking. After receiving more than 130 applications from professionals across 20 countries, ACFCS selected 15 recipients of its Human Trafficking scholarship program.
To view an ACFCS human trafficking resource page, click here.
Rashed was kind enough to share some of his thoughts, expertise and experiences in this ACFCS Scholarship Spotlight.
1. How do you work to detect, prevent and/or raise awareness of financial crime through cryptocurrencies in your job role or outside of it?
Ongoing learning is the first key, as a trainer in the field, I try to communicate with the largest possible number of banking, law enforcement authorities (LEA) and prosecution professionals to provide a seasoned opinion on cryptocurrencies, and to show that crypto is not a synonym of financial crime in the first place.
Once this perception is there, I provide actual examples of how to trace, and potentially seize bitcoins, mainly for now, involved in crime. I have also tried to shape the strategic direction of how to deal with cryptocurrencies in my home country.
In the coming phase, I will work on satisfying the FATF requirements for cryptocurrencies compliance with the newly revised recommendations.
2. What do you see as key challenges related to crypto crime detection/prevention in your role or in the sector overall?
While many current cryptocurrencies provided pseudo-anonymous identifiers, several are now developing anonymization layers, which hide both the sender, the recipient and the transaction.
This anonymization will make life difficult in detecting and investigating a range of crimes. Moreover, the field is full of unknowns yet, which are force multipliers for criminals, i.e. Crypto teller machines, mixers and tumblers, the darkweb in its entirety, crypto-to-crypto exchangers … etc.
Although Cryptocurrencies propelled many entrepreneurs, they have also opened the door to thousands of scammers looking to take advantage of potential investors. Fake Initial Coin Offerings, especially exit scams, are very complex to detect, investigate and potentially seize.
3. What is the most rewarding part of your job?
It is definitely when I make a difference with helping colleagues in their work.
Sometimes someone stops me in the street and tells me that s/he made use of our conversation/lecture/chat to learn something new and to solve a mystery case. Only then, I feel very self-fulfilled and I had made a difference.
4. When it comes to crypto crime detection/prevention, what do you think is going well, and where could we get better?
Awareness is going well and training is on the rise, which is very healthy.
However, companies working in the field of regulatory compliance are still numbered. More work needs to be done to spread [knowledge of] this very specialized field so that crypto does not fall in the wrong hands and go unscathed, [and used to evade compliance controls].
5. Why did you apply for the CFCS certification scholarship?
As I follow you on Linkedin, I saw the announcement and decided to apply, and here I am, one of the lucky winners.
6. How do you think the CFCS credential will impact your career, especially your work to combat financial crime in the crypto space?
It definitely will [help]. This evolving crypto field needs continuous self-education and reading from various sources to rejuvenate one’s knowledge. If you do not progress, you are left out.