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Europe, US Leaders Target Money Laundering

Money laundering has world leaders acting jittery. With US authorities going after Mt. Gox and Dwolla in a rather sloppy way, and Europe meeting in order to create information exchanges between nations, the clampdown on personal finance continues.

European Union leaders will use a summit this week to focus on cracking down upon tax evasion throughout the EU. Leaders of the 27-member bloc will meet in Brussels May 22 to agree on a plan governing how EU countries share tax data after ministers could not reach a decision last week.

The european economy shrank more than economics forecasted in the three months through March, extending a recession to a record sixth quarter.

Last week, Luxembourg and Austria last week blocked efforts to reach agreements on sharing tax data. The accord aims to set standards for how countries collect data on income residents earn in other nations.

“Priority will be given to efforts to extend the automatic exchange of information at the EU and global levels,” according to the draft.

The new rules seek to require member states to participate in information exchanges after a period of transition. The original accord, passed in 2005, offered Austria and Luxembourg an exemption from automatic information exchange requirements. These nations will now have to agree to revise their policies.

Across the pond in the US, concerns over money laundering are also high-up on agendas. Last week, Department of Homeland Security seized Mt. Gox’s Dwolla assets.

“It is a little bit of a hysterical reaction from the U.S. authorities,” Jon Rushman, former managing director at BlackRock and a professor at the University of Warwick in the U.K. said in a statement

“There are concerns of bitcoin being used in illegal ways, but unless there is more substantial evidence of this, I don’t think there is any reason to shut down the main bitcoin exchange. U.S. dollars, Russian rubles and euros have all been used by criminals, but nobody is suggesting their central banks should be closed down and their governors imprisoned.”

The action all comes after the Financial Crimes Enforcement Network issued guidelines on the currency.


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