The world's AML standard-setter has issued a new list of guidelines and clarifications regarding virtual assets and virtual asset service providers or VASPs.

In October last year the FATF changed its recommendations to say explicitly that they apply to financial activities involving virtual assets and also added two new definitions in its glossary - virtual asset and virtual asset service provider or VASP. The amended FATF recommendation 15 states that VASPs ought to be regulated for anti-money-laundering purposes, licensed and subjected to effective monitoring systems.

The international standard-setter recently published an interpretive note to R15 to heap more rules on virtual assets and VASPs, especially with regard to the application of a risk-based approach to activities or operations involving virtual assets and VASPs; to the supervision or monitoring of VASPs for AML purposes; to licensing or registration; to preventive measures such as "customer due diligence" (an ugly term coined by the Basel Committee for Banking Supervision to cover know-your-customer controls), recordkeeping and suspicious transaction reporting; to sanctions and other enforcement measures; and to international co-operation.

The FATF also published the new guidelines to cover the application of a risk-based approach to virtual assets and VASPs. It intends this to help regulators to formulate policy and to help private-sector entities to uderstand their obligations.  

The FATF wants VASPs to understand the money-laundering risks that it associates with their activities and to take appropriate action. It contains "risk indicators" as well.

In its document it also discusses the five types of activity covered by its definition of the term VASP, with examples. It also updates the 2015 FATF Guidance for a Risk-Based Approach to Virtual Currencies.