The Financial Conduct Authority (FCA), the financial regulator in the United Kingdom, has shut down 26 cryptocurrency ATMs as a result of a coordinated investigation. The FCA, along with other law enforcement agencies, examined 36 crypto ATM locations using powers under the Money Laundering Regulations 2017.
In February 2023, the FCA issued an ultimatum to all crypto ATM operators in the UK, giving them the choice to comply with regulations or cease their illegal operations. After issuing the warning, the FCA conducted investigations at 36 crypto ATM locations.
Steve Smart, the joint executive director of enforcement and market oversight at the FCA, spoke out against the use of crypto ATMs, stating that individuals who use these machines are engaging in illegal activity and may unwittingly hand their money over to criminals. Victims of scams involving crypto or Bitcoin ATMs will not receive protection from the government or the machine operator.
During May and June, the FCA inspected 18 locations, coinciding with the public announcement of the inspection drive. It is mandatory for all crypto exchanges and ATMs to be registered with the FCA and adhere to the UK Money Laundering Regulations.
Law enforcement agencies have observed a rise in scams related to crypto ATMs. Scammers often employ fear tactics and impersonate law enforcement officials to deceive unsuspecting individuals into transferring funds through these machines. It is important to note that legitimate law enforcement agencies never demand payment over the phone or via crypto.
This action by the FCA highlights its commitment to stopping illegal activities and enforcing compliance within the cryptocurrency industry. By shutting down non-compliant crypto ATMs, the FCA aims to protect consumers and maintain the integrity of the financial system.
Overall, the FCA’s efforts underscore the importance of regulatory oversight in the crypto space, safeguarding against money laundering and fraudulent activities.