In a major crackdown on illicit crypto trading, the UK's Financial Conduct Authority (FCA) has conducted a series of raids on eight locations in London, in collaboration with HMRC and the SWROCU. The operation resulted in the issuance of cease-and-desist notices and the collection of evidence for ongoing criminal investigations. The targeted sites were suspected of facilitating peer-to-peer crypto transactions without proper registration or anti-money laundering measures, posing a significant risk of financial crime.
Under UK law, crypto exchange providers are required to register with the FCA, but currently, no peer-to-peer crypto traders or platforms are registered. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered traders operating in the UK are doing so illegally and pose a significant financial crime risk. The operation aims to disrupt the flow of illicit funds, with DI Ross Flay of SWROCU noting that unregistered traders can enable criminals to launder and spend illegal money.
This enforcement action builds on previous efforts, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. The FCA has also taken action against offshore platforms and social media figures promoting high-risk crypto products.
As the UK prepares to introduce a new regulatory framework for crypto by October 2027, the FCA is urging consumers to verify the registration status of firms using its online register and warning of the risks associated with dealing with unregistered traders, including the lack of access to the Financial Ombudsman Service or compensation schemes.