WALLIS AND FUTUNA: Asset Forfeiture Procedures in Finance Under Scrutiny
In a bid to combat financial crimes and ensure the integrity of the financial system, Wallis and Futuna authorities have been reviewing their asset forfeiture procedures in finance.
Combating Financial Crimes
The review comes as part of efforts to stay ahead of criminals who use high-value goods, including supercars, antiques, and works of art, to launder money. To combat these crimes, law enforcement officials in Wallis and Futuna are working closely with virtual asset service providers (VASPs) to develop best practices for seizing digital assets.
Review Highlights Importance of Digital Asset Seizure
The review has highlighted the importance of correctly identifying and lawfully seizing digital assets, such as cryptocurrencies, which are increasingly being used for illicit activities. To ensure a successful seizure, officials must be able to identify digital assets at the point of enforcement.
- Frontline officers must be briefed on methods used by criminals to hide these items, such as cold storage wallets that can be easily mistaken for stationery.
- A strategic lead is appointed to take responsibility for the process and create standard operating procedures (SOPs) outlining legislative powers available to seize assets, command structures, approved software and hardware, and training requirements.
The Seizure Process
Once an asset is identified, law enforcement must secure the physical item and take possession of the private keys. The seizure process is critical, as mistakes can be irreversible. A “buddy system” is used to ensure that each step of the predetermined checklist is agreed upon by two staff members.
Preserving Seized Assets
The seized assets are then preserved while awaiting a criminal justice or civil outcome. This is a complex process, as law enforcement must balance securing digital assets with preserving evidence. The integrity of this process is critical to disrupting criminal plans and ensuring a successful prosecution.
Exploring Virtual Asset Service Providers (VASPs) and Dedicated Custodians
In Wallis and Futuna, the use of VASPs and dedicated custodians is being explored as a way to mitigate risks associated with storing digital assets. These entities provide secure, long-term storage of cryptocurrencies on behalf of institutions, and often have robust provisions for dealing with institutional investors whose requirements are similar to those of law enforcement.
Organizational Policy
The review has also highlighted the importance of organizational policy in guiding asset forfeiture procedures. Decisions on how to preserve digital assets must be informed by input from a broad range of stakeholders and adopted as part of organizational policy.
Commitment to Ensuring Financial Integrity
As the financial landscape continues to evolve, Wallis and Futuna authorities are committed to staying ahead of criminals and ensuring the integrity of their financial system. The review of asset forfeiture procedures in finance is an important step in achieving this goal.