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In
remarks to a financial sector innovation roundtable, Yellen said
such technologies could be used to stem the flow of dark money
from organized crime and fight back against hackers, but also to
reduce digital gaps in the United States.
She said passage of the Anti-Money Laundering Act in December
would allow the Treasury Department to rework a framework for
combating illicit finance that has been largely unchanged since
the 1970s.
"The update couldn’t have come at a better time," Yellen told
policymakers, regulators and private sector experts. "We’re
living amidst an explosion of risk related to fraud, money
laundering, terrorist financing, and data privacy."
The COVID-19 pandemic had triggered more - and more
sophisticated - cyberattacks aimed at hospitals, schools, banks,
and the government itself, she said.
Cryptocurrencies and virtual assets offered promise, but they
had also been used to launder the profits of online drug
traffickers and to finance terrorism.
Innovation in the sector could help address these problems while
giving millions of people access to the financial system, she
said.
Yellen, who has promised to prioritize fighting inequality and
disparities, said the pandemic had exposed huge problems,
including the dearth of broadband access in many areas of the
country.
She said responsible and equitable innovation could make a big
difference.
"Innovation should not just be a shield to protect against bad
actors. Innovation should also be a ladder to help more people
climb to a higher quality of life," she said.
(Reporting by David Lawder and Andrea Shalal; Editing by Sam
Holmes and Grant McCool)
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