Law Enforcement Groups Warn CLARITY Act Could Shield Crypto Crime

Five law enforcement associations have sent a letter to the Acting Attorney General warning that the CLARITY Act's safe harbor for software developers could hamper investigations into crypto-related crime.

The letter was signed by 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. It targets Section 604 of the bill.

Section 604 would exempt developers and open-source projects from liability for how users deploy their code. The associations argue this shield could let DeFi platforms and other crypto services avoid oversight, even when they help move or conceal illicit funds.

"Our concern is with broad exemptions that may shield individuals or entities whose activities facilitate the movement of digital assets, create obstacles to legitimate oversight, or weaken longstanding investigative and enforcement authorities relied upon by law enforcement," the letter states. "Regulatory certainty should not come at the expense of accountability, transparency, victim protection, or public safety."