Senator Cynthia Lummis defends CLARITY Act, cites 16+ anti‑money‑laundering safeguards

U.S. Senator Cynthia Lummis defended the Digital Asset Market Clarity (CLARITY) Act against criticism from Senator Elizabeth Warren, who warned the proposal could create loopholes for money laundering, sanctions evasion and terrorist financing. Lummis argued the bill contains more than sixteen specific safeguards, pointing to sections that impose Bank Secrecy Act and AML obligations on digital‑asset brokers (Section 201), expand sanctions authority against Iran and other high‑risk actors (Section 303), and allow exchanges to freeze suspected illicit funds while shielding them from civil liability (Section 305).

Warren cited a report alleging that a cryptocurrency exchange had become a major conduit for illicit Iranian funds, saying the CLARITY Act would worsen such risks. The debate reflects a broader congressional split over how to balance innovation in the cryptocurrency sector with robust anti‑money‑laundering and sanctions enforcement. The Act also seeks to clarify regulatory jurisdiction, assigning digital commodities to the Commodity Futures Trading Commission and investment‑contract tokens to the Securities and Exchange Commission.