The Financial Conduct Authority (FCA) has conducted its first coordinated operation with partner agencies to disrupt illegal peer-to-peer crypto trading across multiple locations in London.
Working alongside HM Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), the FCA targeted eight premises suspected of facilitating unregistered peer-to-peer crypto trading. During on-site inspections, the FCA issued cease and desist letters at each location, instructing traders to stop illegal activity immediately.
Evidence collected during these inspections is now supporting a number of ongoing criminal investigations, underscoring the authorities' focus on tackling financial crime linked to cryptoassets.
Focus on unregistered peer-to-peer crypto activity
Peer-to-peer trading involves individuals buying and selling cryptoassets directly with one another rather than through a centralised exchange. According to the FCA, such activity requires appropriate registration. The regulator stated that there are currently no FCA registered peer-to-peer crypto traders or platforms operating in the UK.
Steve Smart, executive director of enforcement and market oversight at the FCA, said unregistered peer-to-peer crypto traders operating in the UK "are doing so illegally and pose a financial crime risk". He added that the FCA will use its powers and work with partners to disrupt such activity, and noted that consumers should only deal with firms registered with the FCA while remembering that crypto remains a high-risk investment.
DI Ross Flay of SWROCU highlighted the law enforcement benefits of joint operations, stating that working with the FCA and HMRC enables authorities to effectively target and disrupt unregistered peer-to-peer crypto traders operating illegally. He said law enforcement aims to stop these traders providing a route for criminals to move, disguise and spend illegal money.
Broader crypto enforcement efforts
The FCA has previously taken enforcement action against unregistered cryptoasset activity in the UK. This includes prosecuting an individual who operated an illegal network of crypto ATMs. In June 2024, the FCA worked with the Metropolitan Police Service to arrest two individuals suspected of running an illegal cryptoasset exchange.
The Government's National Risk Assessment of Money Laundering and Terrorist Financing highlights that cryptoassets are increasingly used to launder the proceeds of crime. In this context, the FCA stated that it continues to work with domestic and international partners to combat financial crime and protect consumers.
