According to reports, the Central Bank of Argentina has begun work on new regulations that will control all digital wallets within the country. These tools are believed to facilitate fraud. Local media leaks indicate that the law will soon be published.
Central Bank of Argentina Targets Digital Wallets
The Central Bank of Argentina plans to use digital wallets. The directory of the bank is reportedly producing a new set of regulations to better understand what’s happening with the funds in these wallets and improve their KYC measures. The bank stated how it will implement this.
The goal is not to ban anything but rather to apply the same rules banks have today when it comes down knowing about their customers.
These new regulations were announced by the bank because of widespread fraud and insufficient due diligence from companies when onboarding customers. The rules for each wallet are different, therefore the guidelines will need to be applied case by case, central bank members stated.
This will enable the bank to monitor the flow of people who use digital wallets such as Mercado Pago. The number is close to 30 millions. Last year, the Central Bank of Argentina established that these companies had to preserve 100% of the funds of the customers in their bank accounts, crippling companies’ opportunity to profit from investments made with a portion of these funds.
Confiscations are already taking place
The Central Bank has been working on a new framework for digital wallets. However, the AFIP (Argentinian Tax Authority) already took steps to seize digital wallets from taxpayers who owe money. In the next few months, almost 10,000 taxpayers will have their digital wallets taken away.
The plan could already be being executed, since local media are reporting that the first of these seizure cases has occurred. According to reports, the AFIP requested the first confiscation and a judge granted permission for the institution to seize funds from the digital account in order to settle debts accumulated. Although the state attempted to take the bank accounts first of the taxpayer, the result was not favorable.
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