UK FCA’s Crypto ATM crackdown in full force: 34 more locations inspected
“If you use a crypto ATM in the UK, you are using a machine that is operating illegally and you may be handing your money over to criminals. You will not be protected if something goes wrong, and you could lose your money.”
The Financial Conduct Authority (FCA) has provided an update regarding its crackdown on Crypto ATMs spread across the United Kingdom.
Since the start of 2023, the FCA visited and inspected 34 locations across the country suspected of hosting crypto ATMs.
These visits have been part of a coordinated operation with other law enforcement agencies to crackdown on this illicit sector and have disrupted 26 machines operating unlawfully across the country.
“You may be handing your money over to criminals”
Steve Smart, Joint Executive Director of Enforcement and Market Oversight at the FCA, said: “If you use a crypto ATM in the UK, you are using a machine that is operating illegally and you may be handing your 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 operator of the machine to resolve any problems you may have. Often, we see no effective channels of communications for people to get in touch with the operator. We will continue to warn the public and take appropriate enforcement action against unregistered crypto ATM operators.”
The financial watchdog added that, between May and June, 18 sites suspected of operating crypto ATMs across the UK were inspected by the FCA, South West Regional Organised Crime Unit, Bedfordshire Police, Hertfordshire Police, and the Metropolitan Police.
The FCA has previously inspected a number of sites across the UK including East London, Leeds, Exeter, Sheffield, and Nottingham that were suspected of hosting unregistered crypto ATMs.
Crypto ATMs must be registered with the FCA
Cryptocurrencies in the United Kingdom are unregulated and high-risk which means people are very unlikely to have any protection if things go wrong.
Crypto exchange providers in the UK, including crypto ATMs, must be registered with the FCA and comply with the UK Money Laundering Regulations. According to the FCA, no crypto ATM is currently registered with the regulator. Failure to comply may be a criminal offense, punishable by up to 2 years in prison, a fine, or both.
The FCA also stated that, recently, a consumer contacted the Citizens Advice Bureau after paying £1,000 into a crypto ATM in Sheffield in an attempt to purchase crypto. The machine, however, didn’t recognize the transaction nor returned the funds and the shop staff were unable to help or provide any guidance other than providing a single point of contact to the crypto ATM operator.
“The contact was only reachable via WhatsApp and the member of the public was ultimately unable to make contact with the operator of the machine and get their funds returned. Following the FCA’s inspection the crypto ATM at this location is no longer in operation”, the regulator added.