In a coordinated effort, the UK's Financial Conduct Authority, in collaboration with HM Revenue & Customs and the South West Regional Organised Crime Unit, has launched a crackdown on unlicensed peer-to-peer cryptocurrency trading platforms. Eight locations in London were targeted, with cease-and-desist notices issued and evidence collected for ongoing criminal investigations. The FCA alleges that these platforms facilitated direct cryptocurrency transactions between individuals without adhering to necessary registration and anti-money laundering protocols. Under UK law, crypto exchange providers must register with the FCA, yet currently, no registered peer-to-peer crypto traders or platforms exist in the country.
The FCA's executive director of enforcement and market oversight emphasized that unregistered operators pose a significant financial crime risk. Law enforcement views this operation as part of a broader strategy to disrupt channels used for illicit fund movements.
The action follows earlier enforcement measures, including prosecutions of operators of illegal crypto ATMs and collaboration with police to apprehend individuals linked to unregistered crypto exchanges. As the UK prepares to implement a comprehensive crypto regulatory framework by October 2027, the FCA urges consumers to verify the registration status of firms using its online register, warning of potential risks when dealing with unregistered entities, including lack of access to the Financial Ombudsman Service or compensation schemes.