FCA cracks down on suspects in $1.2bn illegal crypto asset deal

Two people were arrested and questioned by the UK’s Metropolitan Police and the Financial Conduct Authority (FCA) for allegedly running an illegal cryptocurrency operation worth more than £1 billion ($1.2 billion) in the region.

The FCA highlighted key registration requirements for crypto companies and issued warnings to consumers.

Suspects arrested and questioned

According to the Financial Conduct Authority (FCA), a substantial amount of crypto assets have flowed through this crypto asset business.

The FCA’s press release stated that “more than £1 billion in unregistered crypto assets are believed to have been bought and sold through this business”. The arrested individuals, aged 38 and 44, were questioned and later released on bail by the FCA.

In their investigation, London’s Metropolitan Police seized numerous digital devices associated with the business during searches of the suspects’ residences. Recently granted powers allow UK police to seize and freeze crypto assets as part of fraud inquiries.

Therese Chambers, the FCA’s Executive Director of Market Enforcement and Supervision, emphasized the agency’s commitment to preventing illegal crypto activities in the UK financial system. She stated,

“The FCA has an important role to play in keeping dirty money out of the UK financial system. These arrests show that we will do everything in our power to stop crypto companies operating illegally in the UK.”

Previously criticized for slow enforcement actions, the FCA has mandated the registration of all companies involved in crypto-assets from January 2021. This move aims to ensure compliance with UK money laundering regulations and combat financial crimes such as the financing of terrorism and illicit transfers of funds.

Since the requirement was implemented, more than 300 companies have applied for registration to provide crypto-related services, but only approximately 44 companies have successfully registered.

FCA requirements

According to the release, companies offering specific crypto-asset services must register with the FCA under the MLRs and comply with established rules and regulations. The FCA emphasized its authority to issue directives and impose restrictions on crypto companies as authorized by the MLRs.

The watchdog regularly alerts UK citizens about the risks associated with crypto assets and maintains a list of suspicious unregistered companies.

Regarding ongoing investigations, the FCA stated that it would refrain from commenting at this time and would provide further updates as appropriate in the future.

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