In a major crackdown, the UK's Financial Conduct Authority (FCA) has launched a coordinated operation against eight unlicensed peer-to-peer crypto trading hubs in London. The action, carried out in collaboration with HMRC and the South West Regional Organised Crime Unit, involved issuing cease-and-desist notices and gathering evidence for ongoing criminal investigations.
The FCA alleges that these platforms facilitated direct crypto transactions between individuals without adhering to required registration and anti-money laundering protocols. Under UK law, crypto exchange providers must register with the FCA, yet currently, no peer-to-peer crypto traders or platforms are registered. According to the FCA's executive director of enforcement and market oversight, Steve Smart, unregistered operators pose a significant financial crime risk.
Law enforcement views this operation as part of broader efforts to disrupt channels used for illicit fund movements. The move follows previous enforcement actions, including prosecutions of illegal crypto ATM operators and the arrest of individuals linked to an unregistered crypto exchange. As the UK prepares to introduce a comprehensive crypto regulatory framework by October 2027, the FCA advises consumers to verify a firm's registration status and warns of potential risks when dealing with unregistered entities, including lack of access to the Financial Ombudsman Service and compensation schemes.