In a coordinated effort, the UK's Financial Conduct Authority, along with His Majesty's Revenue & Customs and the South West Regional Organised Crime Unit, has conducted a series of raids on eight unlicensed peer-to-peer crypto trading locations in London. The operation resulted in the issuance of cease-and-desist orders at each site, with evidence collected to support multiple ongoing criminal investigations, as reported by the FCA. The targeted sites were suspected of facilitating peer-to-peer crypto transactions without adhering to the necessary registration requirements or implementing adequate anti-money laundering measures. Under UK law, crypto exchange providers must register with the FCA; however, currently, there are no registered peer-to-peer crypto traders or platforms operating in the country.
According to Steve Smart, the FCA's Executive Director of Enforcement and Market Oversight, unregistered peer-to-peer crypto traders operating in the UK are doing so illegally, thereby posing a significant financial crime risk. The operation is part of broader efforts to disrupt the flow of illicit funds, with law enforcement agencies emphasizing that unregistered traders can enable criminals to launder and spend illegal proceeds. This enforcement action builds upon previous steps taken 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 set to open in September 2026, 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 leave users without access to the Financial Ombudsman Service or compensation schemes, and may also involve the risk of transactions involving stolen funds.