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Law Enforcement Groups Warn CLARITY Act Section 604 Could Hinder Crypto Crime Investigations

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Catholic And Law Enforcement Groups Warn CLARITY Act Could Weaken

Four national law enforcement organizations put their objection in writing on June 23, 2026. Their letter went to Acting Attorney General Todd Blanche and White House crypto adviser Patrick J. Witt, and it targets Section 604 of the CLARITY Act.

The provision, also known as the Blockchain Regulatory Certainty Act, carries broad exemptions. The groups say those could shield some crypto entities from know-your-customer, anti-money laundering and Bank Secrecy Act duties. In their view that would open oversight gaps and undercut investigations into illicit digital asset activity.

The signers are the National District Attorneys Association, the National Association of Assistant United States Attorneys, the International Association of Chiefs of Police and the National Sheriffs’ Association. Together they represent more than 70,000 law enforcement professionals. The letter says digital assets turn up regularly in cases involving narcotics trafficking, fraud, child exploitation, ransomware, sanctions evasion and terrorism financing.

The groups drew a line on one point. Their concern, the letter says, is not software developers. It is exemptions that could let mixers, tumblers and certain DeFi businesses skip registration and reporting rules, which would weaken investigative tools that have been in use for years.

Who signed, who did not

The letter follows weeks of meetings among law enforcement, the administration, Congress and the crypto industry. The National Fraternal Order of Police and the National Association of Police Organizations did not sign, and the groups say they remain open to working on the bill’s language.

Nearly 100 Catholic leaders have separately warned that the act could weaken safeguards against human trafficking.

Witt has defended the bill. He calls the CLARITY Act as a whole “pro-regulatory, pro-enforcement” and argues that the U.S. has to set standards as money moves faster around the world.

Sources

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