UK Regulator Cracks Down on Illicit London Crypto ATMs

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LONDON (Reuters) – Britain’s markets regulator and police have swooped on suspected illegal crypto cashpoints (ATMs) across east London as authorities step up attempts to disrupt unregistered businesses deemed high risk for consumers.

The Financial Conduct Authority (FCA), which last month launched a similar crackdown in the northern English city of Leeds, said on Wednesday it was reviewing evidence gathered from “a number of sites” and might take further action.

The inspections were conducted under money laundering regulations, which allow officers to enter premises without a warrant, observe activities, seek explanations about documents or information and take copies.

Crypto ATMs (CATMs) allow people to buy or convert money into cryptoassets. But no CATM operators are registered with the FCA, which means any operating here breach British anti-money laundering regulations.

The FCA, which has long warned consumers that cryptoassets are unregulated and that investors should be prepared to lose all of their money, told CATM operators last year to shut the machines down or face further the investigation.

CoinATMRadar, a website that allows users to search for CATMs globally, put the number of these cashpoints in Britain at more than 270 in 2020. It is now showing only 19 locations; 12 in London, six in Birmingham and one in Manchester.

Reuters was unable to establish whether this was down to operators shutting down or because they no longer advertise their existence online.

“It is very possible that they are going under the radar,” noted Marcus Sotiriou, an analyst at crypto brokerage Globalblock. “But there is also definitely an element of fear and uncertainty about what the FCA is going to do next.”

(Reporting by Kirstin Ridley, additional reporting by Elizabeth Howcroft, editing by Louise Heavens)

Copyright 2023 Thomson Reuters.

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