In a coordinated effort, the UK's Financial Conduct Authority (FCA), in collaboration with His Majesty's Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), has conducted a series of raids on eight sites in London suspected of engaging in illicit peer-to-peer crypto trading. The sites in question were issued cease-and-desist orders, and evidence gathered during the operation is currently being utilized in multiple ongoing criminal investigations.

According to the FCA, these platforms were operating without the necessary registration or anti-money laundering controls, posing a significant risk of financial crime. Under current UK law, all crypto exchange providers are required to register with the FCA, yet none have done so to date.

The FCA's executive director of enforcement and market oversight, Steve Smart, emphasized that unregistered peer-to-peer crypto traders are operating illegally and pose a substantial financial crime risk. Law enforcement views this operation as a crucial step in disrupting the flow of illicit funds, with DI Ross Flay of SWROCU noting that unregistered traders can inadvertently enable criminals to launder and spend illegal proceeds.

This enforcement action builds upon previous efforts, including the prosecution of operators of unauthorized crypto ATMs 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 FCA is urging consumers to verify the registration status of firms using its online register, warning that dealing with unregistered P2P traders can leave users without access to the Financial Ombudsman Service or compensation schemes and may involve significant risks, including the potential for transactions to involve stolen funds.