-- The United Kingdom's financial regulator, the Financial Conduct Authority (FCA), has successfully shut down 26 of the 34 crypto ATMs it inspected nationwide since the start of 2023. The 26 crypto ATM locations were investigated by the FCA and other law enforcement agencies under money laundering regulations.
The move comes as part of the regulator's effort to ensure the financial system's integrity and prevent potential illicit activities associated with unregulated crypto transactions. In a press release on July 11, 2023, the FCA regulatory body responsible for overseeing financial activities in the United Kingdom (UK) stated that it had inspected 34 locations suspected of hosting illegal crypto ATMs.
Over 18 sites suspected of operating crypto ATMs across the UK were reviewed in May and June this year by the FCA, Bedfordshire Police, Hertfordshire Police and South West Regional Organised Crime Unit. During the investigations, the market watchdog took decisive action against the crypto ATMs across various regions in the UK found to be operating unlawfully without registration with the FCA, resulting in 26 machines being shut down.
FCA Warns Users Using Crypto ATMs
The move comes amid a global reckoning for the crypto industry as regulators and governments worldwide consider how digital assets should be regulated. On March 11 2022, the FCA issued a termination order for Bitcoin ATMs or was subjected to undisclosed additional action. The FCA noted:
"We are concerned about crypto ATM machines operating in the UK and will therefore be contacting the operators instructing that the machines be shut down or face further action."
The FCA highlighted a lack of regulatory structure, the high-risk potential of fluctuating assets and the importance of upholding the principles within MRL as the primary reasons for the enforcement.
On November 3, 2022, the authority warned operators that compliance with regulations was a prerequisite for continued operation. The regulator's ultimatum emphasised that all crypto ATM operators must comply with anti-money laundering (AML) and consumer protection requirements, providing a safer environment for users engaging in crypto transactions.
The FCA noted that none of the cryptocurrency asset forms that were registered with them were approved to offer crypto ATM services. This means that any of the ATMs operating in the country were doing so illicitly.
Steve Smart, the Joint Executive Director of the Enforcement and Market Oversight unit at the FCA, warned users to be mindful of the machines as criminals may operate them. Smart said, "If you use a crypto ATM in the UK, you are using a machine operating illegally and may be handing money over to criminals. You will not be protected if something goes wrong, and you could lose your money. It is also unlikely you will be able to contact the machine operator to resolve any problems you may have.”
According to experts at Crypto minded on February 14 2023, the FCA mentioned its plans for unregistered crypto automated teller machines (ATMs). The Executive Director of Enforcement at FCA, Mark Steward, said, "The regulator will continue to disrupt unregistered crypto businesses in the country. Crypto products are currently unregulated in the country and high-risk."
Police Detective Sergeant Lindsey Brants mentioned that local enforcement officers had issued several letters to crypto ATM operators requesting to cease using the machines.
According to CoinATMradar, a website that tracks the number of machines in circulation, there are around 36,000 crypto ATMs globally. There are at least 28 locations providing Bitcoin ATMs in the UK, with more than 50% of those crypto ATM locations in London, with additional places near Birmingham, Manchester and Nottingham.
The FCA continues to advise users that all crypto exchanges and ATMs must be registered with them and comply with UK money laundering regulations. UK citizens are regularly warned that crypto assets are unregulated and high-risk, and if something wrong happens, no protection will be available for them. UK's law enforcement agencies also warned consumers to be aware of scammers who impersonate law enforcement, demanding payment over the phone or through crypto.
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Name: Hannah Parker
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Organization: Ascian Solutions OU
Address: Harju maakond, Tallinn, Lasnamäe linnaosa, Väike-Paala tn 2, 11415, Estonia
Website: https://bitcoindecode.com
Release ID: 89106705
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