In a major operation, the UK's Financial Conduct Authority (FCA), in collaboration with HM Revenue & Customs and the South West Regional Organised Crime Unit, has raided eight locations in London suspected of operating as unlicensed peer-to-peer crypto trading hubs. The sites were issued cease-and-desist orders, and evidence gathered is being used in ongoing criminal investigations. The FCA emphasized that these platforms, which facilitate direct crypto transactions between individuals without proper registration or anti-money laundering controls, are operating illegally and pose a significant financial crime risk.
Under UK law, crypto exchange providers must register with the FCA, but currently, no peer-to-peer crypto traders or platforms are registered. The FCA's executive director of enforcement and market oversight, Steve Smart, warned that unregistered traders are not only breaking the law but also enable criminals to launder illicit funds. This operation is part of broader efforts to disrupt the flow of illegal money and follows previous enforcement actions against operators of illegal crypto ATMs and unregistered crypto exchanges. As the UK prepares to implement a 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 cautioned against dealing with unregistered traders, as they lack access to the Financial Ombudsman Service and compensation schemes, and may be exposed to risks including transactions involving stolen funds.