According to reports, Italy is not doing proper checks on crypto firms that have been approved to operate within the country. Regulatory approval is one way of knowing that a firm has gone through checks from relevant authorities. However, in Italy, regulator approval might is not taking the same route.
The OAM (Organismo Agenti e Mediator) is responsible for keeping an updated list of all financial agents in Italy. Regulators are often accused by the industry of taking too long to process applications. But Italy’s OAM has approved 73 crypto businesses rather quickly. Approved businesses include major exchanges such as Coinbase, Binance, and Crypto.com, among others.
A company’s inclusion in the OAM registry guarantees that regulators will check to see if it complies with regional AML regulations in the future. According to the OAM, the operators included on the roster are legally recognized as valid services in Italy.
Why is Italy not checking up on the approved crypto firms?
According to reports, no company was examined before being added to the list, despite the fact that registration with the OAM is now compulsory to conduct business in the nation. The OAM has acknowledged to CoinDesk that it is still considering how to obtain the necessary information from businesses. The regulatory body will most likely not collect the relevant data until next year. This could mean that the Italian authorities are not looking at fund flows and controls to prevent criminal activities.
According to Francesco Dagnino, managing partner at Milan-based law firm, Lexia Avvocati,
“Italy is probably, as far as I’m aware of, the jurisdiction with the most simple process. It’s just a registration.”
Dagnino further highlighted that the Italian registration process is very light. Moreover, the process does not require compliance with any particular requirements.
According to Martin Erhold, public policy lead at crypto exchange Bitpanda,
“It should be remembered that registration as a VASP with the OAM is not the end of the process, but only a first step. All VASPs will now be directly scrutinized for compliance with applicable AML rules and will need to demonstrate their setups are effective.”
On the other hand, in France, firms are required to submit four separate forms. These forms contain all details that outline the business, executive management, important shareholders, and internal AML controls.
As the crypto space has grown, so has illicit activity within it. Therefore, it is very important for agencies to take investor security seriously. Perhaps Italy will start collecting said data from next year, but that still leaves several months of un-vetted activities.