MASAK Updated Suspicious Transaction Notification Guide for Crypto-Asset Service Providers

On 23 June 2024, the Financial Crimes Investigation Board (“MASAK”) announced the publication of an updated version of the Suspicious Transaction Reporting Guide (“Guide“) for the Crypto Asset Service Providers (“CASPs”), who are among the obliged parties under the Law No. 5549 on Prevention of Laundering Proceeds of Crime (“Law No. 5549”). The Guide incorporates feedback from industry representatives and associations, as well as the National Risk Assessment Report on Combating Money Laundering and Terrorism Financing.

The update introduces several key changes and innovations, including:

1. The Suspicious Transaction Reporting Form has been enhanced to encompass all current financial technologies and has been developed to align with the working system of CASPs and the transaction system of crypto assets.

2. In order to more accurately categorize the various types of accounts encountered by obliged parties and to facilitate the monitoring of financial transactions, crypto asset account, balance deposit and withdrawal account, and other account categories have been added to the Guide.

3. Considering the evolving types of crimes, new types of suspicious transactions have been defined. While many items from the first version are still present, numerous additional items have been included regarding customer information, transaction details, transfers made through social media, and the use of crypto assets. In this context, a wide range of new suspicious transaction types have been added to the Guide, including: conducting transactions with untrusted email addresses or phone numbers; receiving high-value transfers from social media platforms and refusing to disclose the nature of the transfers and/or social media user information; having very low social media account interaction despite receiving high-value transfers from social media platforms; frequently using VPNs to log into or conduct transactions on the account; purchasing and then selling high-value NFTs; consistently investing in high-risk or lesser-known ICOs (initial coin offerings); being a business owner or a relative/affiliate of a business owner in a cash-intensive sector (exchange office/jeweler, etc.) or being an employee and frequently conducting high-value crypto asset/fiat currency deposit and withdrawal transactions. As a result, the first version had only 6 suspicious transaction types related to customer profiles and 25 regarding CASPs. The new Guide has significantly expanded this, increasing the number to 16 for customer-related transactions and 93 for CASP-related transactions. Thus, the total number of identified crime types has increased from 59 in the old version to 158 in the new Guide.

4. The scope of existing transaction types has been broadened. Previously, only transactions such as buying, selling, depositing, and withdrawing crypto assets were covered. The updated classification now includes crypto asset swaps, staking, airdrops, custody, initial sales, and internal crypto asset transfers. Additionally, the list has been expanded to include industry-specific transaction types such as POS transactions, card transactions, cancellation, refund, and correction transactions, as well as domestic and international money transfers.

5. New reporting categories such as terrorist organization information and Financing of the Proliferation of Weapons of Mass Destruction have been introduced.

6. Checkpoints have been established to enhance the quality of reports, enabling more effective analysis of suspicious transactions.

7. Reference value tables have been updated, and new information about types of identity verification and financial institutions mediating the transactions has been added.

8. The updated Guide introduces new suspicion categories not present in the first version, including illicit assistance and fundraising, violation of asset freezing orders, financing the proliferation of weapons of mass destruction, non-compliance with obligations, obscenity, and unauthorized CASP activity. Existing crime definitions are now presented with greater clarity, comprehensiveness, and detail compared to the first version and the selection of a suspicion category has been made mandatory.

The MASAK ONLINE 1.0 system, which facilitated electronic reporting, has been redesigned with the latest technology and reintroduced to CASPs, offering more secure and flexible structure platform.

As of July 26, 2024, CASPs operating in accordance with the Capital Markets Law No. 6362 are required to submit all suspicious transaction reports in strict adherence to the principles and procedures outlined in the Guide.

Please find the full text of the Guide and the Suspicious Transaction Reporting Form at the following link:

https://ms.hmb.gov.tr/uploads/sites/12/2024/07/KVHS-REHBER-2-0.pdf