In a coordinated effort, the UK's Financial Conduct Authority (FCA), along with HM Revenue & Customs and the South West Regional Organised Crime Unit, has launched a crackdown on unauthorized peer-to-peer crypto trading operations in London. Eight locations were targeted, with cease-and-desist notices issued and evidence collected for ongoing criminal investigations.
The sites in question were suspected of facilitating direct crypto transactions between individuals without proper registration or anti-money laundering controls, which is mandatory for crypto exchange providers in the UK. As there are no registered peer-to-peer crypto traders or platforms in the country, these operations are deemed illegal and pose a significant risk of financial crime. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered traders operating in the UK are not only illegal but also enable the movement and laundering of illicit funds. This operation is part of broader efforts to disrupt channels used for moving illegal funds.
The action follows previous enforcement measures, including prosecutions of illegal crypto ATM operators 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 comprehensive regulatory framework for crypto by October 2027, with a licensing window set to open in September 2026, the current focus remains on anti-money laundering compliance and financial promotions.
The FCA advises consumers to verify a firm's registration status using its online register and warns that dealing with unregistered traders may result in lack of access to the Financial Ombudsman Service or compensation schemes, and poses risks associated with potentially stolen funds.