Catholic leaders, US authorities challenge CLARITY Act over illicit activity
Law enforcement groups and Catholic anti-trafficking advocates are warning Congress not to rush the CLARITY Act, which is set for a House hearing on July 17. Four law enforcement organizations said Section 604 could create oversight gaps, weaken know-your-customer and anti-money-laundering rules, and make it harder to investigate illicit crypto activity. The Alliance to End Human Trafficking said similar carveouts could hinder efforts against trafficking, organized crime, child exploitation, and sanctions evasion. Supporters argue the section has a narrow هدف: protecting non-custodial software developers, open-source contributors, self-custody tools, and some DeFi infrastructure from being treated as money transmitters. The Blockchain Association says it does not shield criminals or block prosecutions. Senator Cynthia Lummis backs the bill, saying it closes gaps exploited by bad actors.
