The FBI reported that crypto-related scams have drained over $11 billion from investors, a figure driving New York Attorney General Letitia James to push Congress for tougher cryptocurrency regulations. In her recent Senate testimony, James warned that the CLARITY Act might weaken states' power to investigate fraud by shifting regulatory authority too heavily toward the Commodity Futures Trading Commission (CFTC).
Her office has seen complaints about crypto scams nearly triple in the past three years, with reported losses close to $500 million in New York alone over five years. James emphasized that the surge in fraud cases demands stronger enforcement rather than limiting state regulators’ reach.
She advocates for reforms that would require platforms to strengthen their anti-money laundering (AML) and know-your-customer (KYC) standards, enhance cybersecurity, and shoulder responsibility for preventing fraud. James also seeks to preserve existing laws on securities and commodities, warning that inadequate regulation threatens investor confidence, the wider economy, and national security.
