In a joint operation, the UK's Financial Conduct Authority, along with HM Revenue & Customs and the South West Regional Organised Crime Unit, conducted a series of raids targeting eight sites in London suspected of facilitating unauthorized peer-to-peer cryptocurrency trading. The sites were issued cease-and-desist orders, and evidence collected is being used in ongoing criminal investigations. The FCA stated that these sites were operating without the required registration or anti-money laundering controls, posing a significant risk of financial crime.
Under UK law, all crypto exchange providers must register with the FCA, and currently, there are no registered peer-to-peer crypto traders or platforms in the country. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered peer-to-peer crypto traders in the UK are operating illegally and pose a significant financial crime risk. Law enforcement views this operation as part of a broader effort to disrupt the flow of illicit funds. The action is an extension of previous enforcement measures, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to an unregistered crypto exchange.
Last year, the FCA also took action against an offshore platform for unlawful financial promotions and expanded its oversight of social media figures promoting high-risk crypto products. As the UK prepares to introduce a more comprehensive regulatory framework for crypto by October 2027, the FCA is urging consumers to verify the registration status of firms using its online register and warning that dealing with unregistered P2P traders can result in a lack of access to the Financial Ombudsman Service or compensation schemes, and may involve risks associated with stolen funds.