Odaily Planet Daily report: Luxembourg has enacted a new law authorizing its Financial Intelligence Unit (FIU) to send cross-institutional fraud alerts to traditional banks and cryptocurrency exchanges, with the measures taking effect on August 8. The law, numbered 8722, requires cryptocurrency exchanges operating in Luxembourg to receive alerts in sync with banks and payment institutions. The law aims to close the loophole that allows fraudulent funds to rapidly move between traditional financial institutions and digital assets. Under previous rules, banks could only block transactions involving flagged accounts within their own systems and were unable to notify other financial institutions or cryptocurrency exchanges to prevent fund transfers. Max Braun, head of Luxembourg’s FIU, stated that including cryptocurrency exchanges in the cross-sector alert system will make it more difficult to cash out funds from related accounts. According to data from Luxembourg’s Ministry of Justice, in 2024, police recorded 6,382 fraud cases, and financial sector professionals submitted over 18,000 reports of fraud and scams.
Luxembourg Includes Crypto Exchanges in FIU Alert System
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Summary
Luxembourg has integrated crypto exchanges into its Financial Intelligence Unit (FIU) alert system under new law No. 8722, effective August 8. This enhancement strengthens the crypto scam alert system by enabling real-time tracking of fraud-related funds between traditional and digital finance. Previously, banks could only block internal transactions. FIU head Max Braun stated that the change will impede cash-out attempts. In 2024, police recorded 6,382 fraud cases and received over 18,000 cryptocurrency-related reports from financial professionals.
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