Financial Crime World

Financial Sector Firms Unaware of Virtual Assets and VASPs in Papua New Guinea

A recent survey conducted by the Financial Analysis and Supervision Unit (FASU) has shed light on the awareness levels of financial sector firms in Papua New Guinea regarding virtual assets and Virtual Asset Service Providers (VASPs).

Survey Results

The survey, which targeted various sectors including insurance companies, superannuation firms, securities/stock exchange companies, law firms, accounting and auditing firms, real estate companies, peer regulators, and IT experts from the banking and finance sector, revealed that:

  • Limited Knowledge of Virtual Assets: Only a few respondents had even heard of virtual assets.
  • No VASPs as Customers: 96% of respondents indicated that their business did not have any VASPs as customers.
  • No Exchange Services: All respondents confirmed that their business does not provide exchange services for virtual assets.
  • No Identification of Virtual Asset Users: 96% of respondents have not identified any of their customers using virtual assets.
  • Accessibility to Virtual Assets: 98% of respondents attested that their business does not make virtual assets accessible to their customers.
  • Awareness of ML/TF Risks: 94% of respondents were not aware of any events that could be characterized as money laundering, terrorist financing (ML/TF) involving virtual assets in PNG.

Risks Associated with Virtual Assets and VASPs

The survey also found that most respondents were not aware of the risks associated with virtual assets and VASPs. Only 23% of respondents thought that there are vulnerabilities in PNG’s Anti-Money Laundering and Combating the Financing of Terrorism (AML/CTF) regime that might render PNG vulnerable to ML/TF involving virtual assets.

FASU Warning

The FASU, which is responsible for regulating the financial sector in PNG, has warned that while virtual assets may seem like a distant threat, they pose significant risks to the country’s financial stability and security. The agency has called on financial institutions to be vigilant and educate themselves about virtual assets and VASPs to prevent any potential threats.

Bank of Papua New Guinea Warning

In related news, the Bank of Papua New Guinea (BPNG) has warned that while there are no cases of ML/TF involving virtual assets in PNG, the risk remains at medium due to uncertainties about PNG nationals accessing online platforms to trade with virtual assets.