Turkey’s financial crimes watchdog has issued guidelines on cryptocurrency exchange platform transactions after two companies were held liable for causing losses worth tens of millions of dollars to nearly half a million customers.
Nearly 40 Turkish companies operating in the digital currencies market are now obliged to report suspicious transactions in 10 days at most, according to “The Guide For Crypto Asset Service Providers” released by the Financial Crimes Investigation Board (MASAK) on May 4.
They will also be entitled to verify the identities of all subscribers, the guide said.
For non-subscriber customers, identity verification will be a must for all suspicious activities and those transactions with a volume of more than 75,000 Turkish Liras (nearly $8,990), it added.
Companies will be fined at least 30,000 liras ($3,595) in case of a failure to verify customer identities and 50,000 liras ($5,990) for a failure to inform suspicious transactions.
A crypto exchange company owner can face up to three years of jail time for refusing to collect and report the necessary files.
Turkey added cryptocurrency trading platforms to the list of firms covered by anti-money laundering and terrorism financing regulation, it said in a presidential decree published early May 1.
The move came after a ban on using cryptocurrencies for making payments, introduced in response to claims that such transactions are too risky, took effect in Turkey on April 30.
The presidential decree makes “crypto-asset service providers” responsible for seeing their assets are not used illegally.
Turkish authorities last month launched fraud investigations into two cryptocurrency exchanges, Thodex and Vebitcoin.
Six suspects linked to the Thodex probe were jailed on April 30, pending trial.
Interpol issued a detention warrant for the firm’s CEO, Faruk Fatih Özer, on Turkey’s behalf. Turkey has sent two five-member police teams to Albania, where Özer fled after the Thodex website went offline abruptly and trapped cryptocurrency codes of nearly 400,000 customers on April 19.
The total assets allegedly seized by Özer is around $108 million, legal experts told the Turkish Interior Ministry after initial examinations.
İlker Baş, the founder of Vebitcoin, his wife and two employees were also arrested after Vebitcoin halted operations on April 23. Baş has been accused of making XRP altcoin transactions worth over $24 million to his overseas accounts in a month.