In a coordinated effort, the UK's Financial Conduct Authority, along with HM Revenue & Customs and the South West Regional Organised Crime Unit, conducted a series of raids on eight sites in London suspected of operating unauthorized peer-to-peer crypto trading platforms. The operation resulted in the issuance of cease-and-desist orders and the collection of evidence for ongoing criminal investigations.
The targeted sites were allegedly facilitating direct crypto transactions between individuals without adhering to mandatory registration requirements or implementing anti-money laundering measures. Under UK law, crypto exchange providers must register with the FCA, and currently, there are no registered peer-to-peer crypto traders or platforms in the country. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered peer-to-peer crypto traders operating in the UK are acting illegally and pose a significant financial crime risk. Law enforcement agencies view this operation as part of a broader effort to disrupt the flow of illicit funds.
The action is an extension of previous enforcement measures, including prosecutions of operators of unauthorized crypto ATMs and collaboration with police to apprehend individuals linked to unregistered crypto exchanges. The FCA has also taken action against offshore platforms for unlawful financial promotions and expanded its oversight of social media figures promoting high-risk crypto products. As the UK prepares to implement a comprehensive regulatory framework for crypto by October 2027, the FCA urges consumers to verify the registration status of firms using its online register and warns that dealing with unregistered P2P traders may result in limited access to the Financial Ombudsman Service or compensation schemes and increased risks associated with stolen funds.