Dear Mr. Chairman and Senator Warren,
I am writing on behalf of the members of the Fraternal Order of Police to advise you of our support for the most recent version of H.R. 3633, the “Digital Asset Market Clarity Act,” or “CLARITY Act.”
We have reviewed the clarifying language in the revised Section 10604 amending the Blockchain Regulatory Certainty Act (BRCA) and are satisfied that the provision does not limit the ability of law enforcement and prosecutors to address unlawful conduct involving digital assets. We appreciate the inclusion of this clarification, which directly addresses the concerns we had raised during our conversations about the legislation.
As law enforcement officers continue to confront growing fraud schemes, organized criminal activity, and illicit finance involving digital assets, it is essential that investigators retain clear authority and practical enforcement tools. The latest version of the “CLARITY Act” includes several provisions that improve the ability of State and local law enforcement to protect consumers, investigate financial crimes, and coordinate with their Federal partners.
The revised bill establishes safeguards aimed at addressing fraud and victimization involving digital asset kiosks and related activity while also providing for anti-money laundering and sanctions compliance obligations across the digital asset ecosystem. The bill’s new language also includes provisions that improve law enforcement’s ability to intervene before illicit funds disappear by protecting digital asset companies and stablecoin issuers from liability when voluntarily delaying suspicious transactions or acting at the request of law enforcement. Given the speed at which digital assets can move across jurisdictions, temporary transaction holds can provide investigators with critical time to prevent fraud losses, recover stolen assets, and disrupt illicit activity.
The revised bill also modernizes authorities related to seizure, tracing, and illicit finance investigations by updating the treatment of digital assets under Bank Secrecy Act authorities relating to monetary instruments. This should help to ensure that existing reporting and enforcement frameworks clearly apply to digital asset activity. Additional provisions direct agencies to improve information sharing, coordinate on illicit finance risks, and strengthen international anti-money laundering and sanctions cooperation involving digital assets.
Title IX of the most recent version of the bill provides law enforcement with tools, including a grant program for State and local digital asset enforcement capabilities, a digital asset law enforcement and national security training program, the establishment of a digital asset cyber innovation center, and measures aimed at protecting aging retirees from deception. These provisions will help equip frontline officers and local agencies with the resources and expertise needed to investigate digital asset crimes and better protect consumers.
The revised bill clarifies that the treatment of certain non-controlling software developers and decentralized technologies does not curtail the ability of law enforcement to investigate criminal conduct, prosecute bad actors, or apply longstanding criminal statutes—including 18 U.S.C. § 1960—to illicit activity involving digital assets. The explicit preservation of liability for those who act with intent to transfer funds known to be from criminal offenses or intended to promote unlawful activity provides the certainty law enforcement requires while allowing responsible innovation to proceed.
We believe the provisions outlined above represent a meaningful effort to provide law enforcement with stronger investigative tools, clearer compliance pathways, and improved coordination mechanisms to address these threats while protecting consumers and victims. Accordingly, the FOP’s initial concerns have been satisfactorily addressed and we look forward to working with you to get the amended bill passed.
On behalf of the more than 382,000 members of the Fraternal Order of Police, I thank you both and your staff for your engagement and commitment to providing law enforcement with the tools and assurances we need to protect consumers and combat criminal activity using digital assets. If I can provide any additional information about this legislation or the issue generally, please do not hesitate to contact me or Executive Director Jim Pasco in our Washington, D.C. office.
Sincerely,
Patrick Yoes
National Preside