- Experts testified that the 1970 Bank Secrecy Act is “structurally incapable” of combating AI-enabled financial crime, as illicit funds now move within 24-48 hours.
- North Korean Hackers stole over $2.6 billion in crypto across 2025 and early 2026, while AI-powered scams surged 500% in a year.
- Witnesses were split on solutions, ranging from full repeal to modernizing the law with stronger AI tools and information-sharing frameworks.
- President Trump recently signed an executive order expanding BSA rules to flag financial risks associated with undocumented immigrants.
On Thursday, crypto executives and policy experts testified before a House subcommittee on modernizing the 1970 Bank Secrecy Act (BSA) for the age of AI and digital assets. The hearing focused on how outdated anti-money laundering laws fail to combat modern financial crime, which now operates at machine speed.
TRM Labs Global Head of Policy Ari Redbord warned that AI-enabled scam activity surged 500% last year. He stated that illicit funds move across wallets in 24 to 48 hours, making retrospective reporting frameworks obsolete.
Consequently, Redbord argued the BSA is “structurally incapable” of generating a timely response. He cited how North Korea stole over $2 billion in digital assets in 2025 and Korea-stole-76-of-all-crypto-hack-value-in-2026-with-just-two-attacks” target=”_blank” rel=”nofollow external noopener”>another $600 million early this year.
Subcommittee Chairman Warren Davidson called the BSA a “bloated surveillance machine” producing millions of reports annually. However, witnesses offered divergent solutions for reform.
The Cato Institute‘s Nicholas Anthony argued the core problem is surveillance itself, suggesting options from adjusting thresholds to full repeal. Conversely, Atlantic Council Senior Fellow Carole House cautioned against deep cuts that could harm national security.
There was consensus on leveraging AI, with Redbord calling for federal funding of AI-native investigative tools for agencies. This hearing followed President Donald Trump‘s executive order expanding BSA due diligence rules. The order directs tighter scrutiny of accounts tied to undocumented immigrants.
✅ Follow BITNEWSBOT on Telegram, Facebook, LinkedIn, X.com, and Google News for instant updates.
