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U.S. DEPARTMENT OF THE TREASURY
Remarks on Illicit Finance by Assistant Secretary for Terrorist
Financing and Financial Crimes Elizabeth Rosenberg in Sydney,
Australia
March 13, 2023

SYDNEY - Today, Assistant Secretary for Terrorist Financing and Financial Crimes Elizabeth
Rosenberg spoke at a roundtable of banks in Sydney, Australia to discuss illicit finance issues.

As Prepared for Delivery
Good morning, everyone. My name is Elizabeth Rosenberg, and I am the Assistant Secretary for the
U.S. Department of the Treasury’s Office of Terrorist Financing and Financial Crimes. My office
guides U.S. Government’s efforts to address money laundering, terrorist financing, proliferation
financing, financial sanctions, and our national security priorities in economic statecraft.
I am in Australia to meet with my counterparts here to strengthen our cooperation on all of these
issues. Being on the financial front lines, you all know best how criminal and geopolitical
adversaries rarely remain still or respectful of national borders: they will look for the weakest link
they can exploit.
This is why I believe we all have a part to play in disrupting and stopping illicit financial flows. This
makes you essential partners in our fight to protect the integrity of the international financial
system. We are most effective when our governments—and our private sector—work together.
The financial threat landscape certainly features immense and daunting challenges. Just over a year
ago, Russia launched an invasion into Ukraine which altered how the responsible countries of the
world interacted with a G20 economy. Over 30 countries, including Australia, put into place the most
comprehensive and multilateral economic pressure campaign in history. Over the past year, you all
have had to implement sanctions and other restrictions against thousands of entities, including
against Moscow’s largest financial institutions and state-owned enterprises. Your efforts have
yielded dramatic results. Russia has lost access to its reserves abroad, is unsustainably using its
fiscal buffers to keep its economy afloat, and is faced with steep cuts to the revenue that it needs to
fund its invasion of a sovereign nation.
In addition, the explosion and pace of developments in the virtual asset space are, frankly,
astounding. This can often mean that industry treats regulations and financial crimes compliance as

an afterthought. While governments should be weary of stifling innovative spirit, we cannot forsake
the obligation to promote financial integrity and protect people and financial systems from
fraudsters and criminals.
I am intrigued by the potential legitimate use cases for decentralized finance—yet I know that illicit
actors are constantly looking for effective ways to hide criminal activity and the laundering of their
proceeds. This is a threat to DeFi services or other elements of the virtual asset ecosystem. For this
reason, my team is actively working on and will soon publicly release an illicit finance risk
assessment on DeFi.
Some of the illicit finance risks pertaining to virtual assets are best illustrated in the North Korea
context. North Korea-affiliated actors have conducted ransomware attacks, stolen hundreds of
millions of dollars’ worth of virtual assets, and laundered their ill-gotten funds through mixers and
other virtual asset service providers to fund North Korea’s illegal nuclear and ballistic missiles
programs.
I am interested in discussing with you solutions to address and prevent this and many other forms
of financial crime. One important tool for addressing illicit finance broadly is a more robust
understanding of beneficial ownership. Just this past month, the Financial Action Task Force (FATF)
adopted guidance to help countries and the private sector implement last year’s revisions to FATF
Recommendation 24 on the transparency of legal persons, and endorsed enhancements to
Recommendation 25 relating to the transparency of legal arrangements. These improvements will
raise the standards required for beneficial ownership information transparency. Though effectively
implementing these changes will be challenging for many jurisdictions, I believe that these
enhancements to the international standard for beneficial ownership information transparency will
be a major step towards denying illicit actors the ability to hide their funds across both of our
jurisdictions, and others.
Yet amid all these changes, the tried-and-true solutions remain the same. We must constantly reexamine risks, share information with relevant stakeholders, and create a risk-based culture of
cooperation and compliance.
Lastly, I want to address something very specific to the region. Much as the United States and our
financial institutions have challenges reaching or serving some under-banked populations, I know
that you all have similar concerns with your relationships in many Pacific Island Countries. There is
a clear imperative to work with the Pacific Island Countries on financial inclusion, development
assistance, and economic stability. I can tell you that both the United States and the government of
Australia are one hundred percent bought-in to support these goals. Last September, President
Biden announced $810 million dollars to expand programs seeking to improve the lives and

wellbeing of those in the Pacific Islands. My Treasury colleagues and I are highly focused on
understanding and addressing challenges with correspondent banking in the region.
From my position as a policymaker, I am eager to learn more about how you are assessing risk
regarding your correspondent banking relationship with the Pacific Islands Countries and to work
with the Australian government and you all to mitigate de-risking and promote strong
correspondent banking ties.
With that, I turn it over to you to hear your perspectives on these important issues and how we can
continue our strong partnership in addressing these challenges. Thank you.