In a coordinated effort, the UK's Financial Conduct Authority (FCA), in collaboration with HM Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), has conducted a series of raids on eight locations in London, marking its first major crackdown on unlicensed peer-to-peer crypto trading platforms. The operation resulted in the issuance of cease-and-desist notices and the collection of evidence, which is currently being used in multiple criminal investigations. According to the FCA, these platforms were suspected of facilitating peer-to-peer crypto transactions without the necessary registration or anti-money laundering controls, which is a requirement under UK law. The FCA has emphasized that there are currently no registered peer-to-peer crypto traders or platforms in the UK, and operating without registration is considered illegal and poses a significant risk of financial crime.
The FCA's executive director of enforcement and market oversight, Steve Smart, stated that unregistered peer-to-peer crypto traders operating in the UK are doing so illegally and pose a financial crime risk. Law enforcement agencies view this operation as part of a broader effort to disrupt the flow of illicit funds. The South West Regional Organised Crime Unit's DI Ross Flay noted that unregistered traders can enable criminals to launder and spend illegal funds.
This enforcement action builds upon previous efforts by the FCA, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. 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, with a licensing window expected to open in September 2026, the FCA has urged consumers to verify the registration status of firms using its online register.
The regulator has also warned that dealing with unregistered P2P traders can leave users without access to the Financial Ombudsman Service or compensation schemes, and may expose them to risks associated with stolen funds.