In a landmark operation, the UK's Financial Conduct Authority (FCA), in collaboration with HM Revenue & Customs and the South West Regional Organised Crime Unit, has conducted a series of raids on eight locations in London suspected of hosting unauthorized peer-to-peer (P2P) cryptocurrency trading platforms. The sites, which facilitated direct crypto transactions between individuals without adhering to mandatory registration and anti-money laundering protocols, were served cease-and-desist notices, and evidence gathered is fueling multiple criminal investigations. According to the FCA, these platforms, by operating outside the legal framework, pose significant financial crime risks.
Under UK law, crypto exchange providers must register with the FCA, yet currently, no P2P crypto traders or platforms are legally registered. The FCA's Executive Director of Enforcement and Market Oversight, Steve Smart, underscored that unregistered P2P crypto traders are operating illegally and pose a financial crime risk.
Law enforcement views this operation as crucial in disrupting the flow of illicit funds, with DI Ross Flay of SWROCU noting that unregistered traders can enable criminals to launder money. This enforcement action follows previous steps against illegal crypto ATMs and unregistered crypto exchanges, as well as actions against offshore platforms for unlawful financial promotions. As the UK prepares to introduce a comprehensive crypto regulatory framework 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, warning of the risks associated with dealing with unregistered entities, including lack of access to the Financial Ombudsman Service and potential involvement in transactions with stolen funds.