Crypto ATMs feel the heat following UK FCA crackdown
- The Financial Conduct Authority (FCA) of the United Kingdom is cracking down on unregistered cryptocurrency ATMs.
- Potential connections between these ATMs and organized crime have been highlighted all over the world.
The Financial Conduct Authority (FCA) of the United Kingdom is cracking down on unregistered cryptocurrency ATMs.
According to the regulator, it entered and inspected several sites near Leeds, in the North of England, which were suspected of hosting illegally operated crypto ATMs.
As part of the joint investigations into sites suspected of hosting illegally operated crypto ATMs, the FCA said that it worked with local police forces, including the West Yorkshire Police’s Digital Intelligence and Investigation Unit.
According to Mark Steward, the FCA’s executive director of enforcement and market oversight, crypto businesses operating in the UK must register with the FCA for anti-money laundering purposes. However, crypto products are currently unregulated and high-risk.
According to the announcement, the FCA will review the evidence gathered during these visits and consider further enforcement.
Detective Sergent Lindsay Brants of the West Yorkshire police’s Force Cyber Team said that they issued cease and desist letters to operators. Moreover, any breach of regulations would cause an investigation under money-laundering regulations.
Status of crypto regulations in the UK
The FCA wrote to all the crypto operators and hosts in March 2022. It warned them about the legal ramifications of operating crypto ATMs without the firm’s authorization.
Though there is no specific law in the UK prohibiting crypto ATMs, none have received FCA approval as of the time of writing.
The connections between crypto ATMs and money laundering are real. Inasmuch, legal forces have highlighted potential connections between these ATMs and organized crime.
The UK appears to be looking to implement much harsher crypto regulations across the board, not only crypto ATMs. Additionally, companies that do not follow the mandated routes may face criminal penalties of up to two years in prison.