US Congress Passes Bill to Require Study of Crypto in Sex, Drug Trafficking
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The United States House of Representatives has passed a bill to commission a study into how cryptocurrencies and online marketplaces can be used to facilitate sex and drug trafficking. The bipartisan bill — known as “the Fight Illicit Networks and Detect (FIND) Trafficking Act of 2019 (H.R. 502) — passed 412-13 yesterday, Jan. 28.
The bill was sponsored by Representative Juan Vargas, D-Calif., and first introduced in June of last year.H.R. 502 will require the Comptroller General of the U.S. to investigate how cryptocurrencies and online marketplaces may (in)directly enable sex or drug trafficking, and — based upon the study’s findings — recommend regulatory and legislative actions that would impede such illicit use. According to Washington D.C.-based political newspaper Roll Call, Vargas appealed to the House that:
- “If we are to craft effective regulatory and legislative solutions to combat these transnational criminal organizations, we need to fully study and analyze how virtual currencies and online marketplaces are used to facilitate sex and drug trafficking, to determine how best to eliminate their use.”
An official press release from Vargas published yesterday emphasized that “while evidence points to the growth of virtual currencies as a payment method for illicit sex and drug trafficking, the true scope of the problem and potential solutions are still unknown.”
As an earlier memorandum outlined, the Comptroller General will be due to present his findings before the Committee on Banking, Housing, and Urban Affairs and the Committee on Financial Services.
Alongside H.R. 502, lawmakers yesterday agreed by voice vote to pass H.R. 56, which would create a grant fund for programs and ideas aimed at preventing the nefarious use of cryptocurrencies. The bill would also create an interagency task force, headed by the Secretary of Treasury, to investigate the use of new financial technologies in illicit contexts.
Roll Call cites Kristin Smith, director of external affairs at the Blockchain Association, as stating that the organization is “pleased Congress continues to take a serious look at these issues.”
Earlier this month, a bill exempting companies providing non-custodial crypto services from certain state money transmitting laws was re-submitted to Congress. In October, two representatives proposed a new bill, the "Blockchain Promotional Act 2018," to the House of Representatives, advocating for the formation of a working group to study the potential impact of blockchain across the policy spectrum, and to establish a common definition of the technology.
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