Mnuchin 'not comfortable' with Facebook launching Libra

Steven Mnuchin on Facebook's Libra: Treasury Department has expressed very serious concerns

Treasury Secretary Steven Mnuchin on the department's concerns over Facebook's plan for a cryptocurrency called Libra.

U.S. Treasury Secretary Steven Mnuchin said during a press conference on Monday that he was not currently comfortable with Facebook launching its Libra cryptocurrency platform.

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“I didn’t say I was comfortable with [Facebook] launching a currency … I’m not comfortable today,” Mnuchin told reporters. “They … have a lot of work to do before they get us comfortable.”

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Mnuchin added that the administration has had multiple meetings with regulators and representatives from Facebook, where the U.S. government expressed its concerns to the social media company. He wouldn't publicly speculate how long it would take before the administration felt comfortable with the idea.

A spokesperson for Facebook said the company had no comment.

The Treasury Department has concerns that Libra could be misused by terrorist financiers and/or money launders, to carry out illicit activities ranging from cybercrime to tax evasion, extortion and ransomware.

“This is indeed a national security issue,” Mnuchin said, adding that Facebook would be required to implement the same anti-money laundering – and other safeguards – as financial institutions.

He said the company has “a lot of work to do” to show the government that they should be granted access to the U.S. financial system.

Mnuchin mentioned there are concerns about “privacy issues,” after the company was fined a record $5 billion by the Federal Trade Commission over its data privacy practices.

Facebook recently unveiled plans to offer a digital wallet, which would allow for the instant transfer of money across the globe, providing banking options for people with limited access. It has said it will be one of a consortium of dozens of companies that would participate in the Libra Association – an independent entity that would manage the cryptocurrency.

Federal Reserve Chair Jerome Powell said last week there were “serious concerns” about Libra, specifically where consumer protection, illicit activity and financial stability were concerned.

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As previously reported by FOX Business, President Trump said Facebook should have to register as a bank if it plans to move forward with Libra – indicating it should be subject to banking regulations.

Representatives from Facebook are expected to testify before lawmakers this week.