Luxembourg will include cryptocurrency exchanges in the FIU alert system

Luxembourg has passed a new law that authorizes the Financial Intelligence Unit (FIU) to send cross-institutional fraud alerts to traditional banks and cryptocurrency exchanges, with the measures taking effect on August 8. The bill, numbered 8722, requires cryptocurrency exchanges in Luxembourg to receive alerts in sync with banks and payment institutions.

The law aims to close loopholes that allow fraudulent funds to be quickly transferred between traditional financial institutions and digital assets. Under previous rules, banks could only intercept transactions of flagged accounts within their own systems and could not notify another financial institution or cryptocurrency exchange to stop funds from entering or leaving. Max Braun, head of the Luxembourg FIU, stated that including cryptocurrency exchanges in the cross-departmental alert system will make cashing out related accounts more difficult. Data from the Luxembourg Ministry of Justice shows that in 2024, the country's police recorded 6,382 fraud cases, with financial practitioners submitting over 18,000 fraud and scam reports.