Trump Administration Task Force Targets Crypto Fraud

The Trump administration announced the launch of a new task force aimed squarely at "Cyber fraud" and digital currency, identifying financial market fraud as a key issue and placing cryptocurrencies under the microscope.

Announced via an executive order published July 11, 2018, the Task Force on Market Integrity and Consumer Fraud is intended to expand the powers of regulatory bodies and agencies to "Investigate and prosecute crimes of fraud," placing digital currency-related crime within the scope of investigation associated with traditional financial crimes such as fraudulent investment schemes or money laundering.

The new task force, led by Deputy Attorney General Rod J. Rosenstein, plans to "Provide guidance for the investigation and prosecution of cases involving fraud on the government," specifically identifying cyber-fraud targeting the elderly, service members, and veterans.

The rapidly evolving cryptocurrency market is home to an increasing amount of fraud, as evidenced by a recent white paper on financial crimes published by the Beijing Municipal People's Procuratorate that demonstrates a 26% rise in illegal fundraising and financial crime.

Earlier statistics published by UK national fraud and cybercrime reporting agency shows that cryptocurrency-related crime has tripled in the last two years.

The new Trump task force will bring together the SEC, the STFC, and the Department of Justice to enhance cooperation between agencies.

This allows the Attorney General to make recommendations to the President for "Changes in rules, regulations, or policy, or recommendations to the Congress regarding legislative measures, to improve the effective investigation and prosecution of fraud and other financial crimes."

Deputy Attorney General Rod Rosenstein elaborated on the Trump administration's position on financial fraud at a press briefing regarding the order in Washington, stating that,.

"Fraud committed by companies and their employees has a devastating impact on American citizens in the financial markets, the health care sector, and elsewhere."

The announcement of the Task Force on Market Integrity and Consumer Fraud follows a spate of crypto fraud cases that include a CFTC case against CabbageTech owner Patrick McDonnell, who allegedly defrauded investors out of $500,000 as detailed in a lawsuit filed in January.