The UK Financial Conduct Authority (FCA) has cracked down on cryptocurrency ATMs in the country and has moved its investigation to the East London area, according to Reuters.
The FCA is working with West Yorkshire Police to address an unregistered ATM in Leeds. The FCA said it had collected evidence from “a number of sites” in the area for further investigation and could take legal action. according to to Reuters.
Financial watchdogs are now working with the Metropolitan Police to focus on illegal crypto-encrypted ATM operations in east London. The operation is conducted under anti-money laundering (AML) regulations, which allows police to enter premises without a warrant, observe procedures, and request information and documents.
FCA for Crypto ATMs
Crypto ATMs gained popularity on a global scale in 2020 and 2021. Even before they became popular in the UK, these ATMs were very unwelcome.
In 2019, the UK issued a notice to file all cryptocurrency ATMs and exchanges under existing AML requirements. These AML requirements require communicating a thorough Know Your Customer (KYC) process and collecting the user’s name, official ID, date of birth and address, which crypto ATMs do not comply with.
With this notice, the FCA required all cryptocurrency ATMs and exchanges to meet AML requirements and register with the FCA. When Watchdog published his second piece of information in 2022, there were no FCA-registered crypto ATMs. caveatThe warning reminds us of AML and registration requirements and states:
“I am concerned about cryptocurrency ATM machines operating in the UK and will contact the operator to either shut down the machines or face further action.”
Crypto ATMs in the UK
According to Reuters, there are currently 19 cryptocurrency ATMs in the country, none of which are registered with the FCA. The number was 270 for him in 2020, shortly after the FCA issued its first warrant.
Commenting on the drastic drop in the number of ATMs, an analyst at cryptocurrency broker Globalblock told Reuters:
“They are very likely under the radar. But there is definitely an element of fear and uncertainty about what FCA is going to do next.”
Some crypto ATM services have been trying to register with the FCA since 2019. One such example is Gidiplus, which applied for registration in June 2022.
Although Gidiplus complied with all KYC and AML requirements, the FCA denied the company’s request for registration, citing the following reasons:
“Lack of evidence as to how Gidiplus conducts business in a broadly compliant manner…the risk that the applicant’s business could be used for money laundering and terrorist financing.”
