UK FCA Orders Illegal Crypto Service Providers to Shut Down ATMs

  • Richard Marley
  • March 16, 2022
  • 2 minutes read
  • 2074

The UK’s Financial Conduct Authority has ordered crypto firms operating illegally in the country to shut down their ATMs or face enforcement action.

In the official notice published on the FCA’s website on March 11, the authority stated that crypto service providers must immediately close down their ATMs. Operators that fail to do so and continue operating despite the warning will be subject to enforcement action.

The official notice explained the new order in detail:

Crypto ATMs that offer crypto-asset exchange services in the UK must be registered with FCA and comply with the UK Money Laundering Regulations (MLR).

None of the crypto asset firms that are registered with the FCA can offer crypto ATM services in the UK and if they are doing so, it would be considered illegal and consumers must not use them either. 

The FCA decided to take legal action against crypto ATM operators in the country following the legal judgment taken by the Upper Tribunal against the crypto firm Gidiplus in February 2022.

Gidiplus wanted the country’s Upper Tribunal to allow it to continue trading while it waits for the judgment of its appeal against the FCA’s decision to refuse its application for registration under the MLRs.

The Tribunal decided that there wasn’t sufficient evidence to confirm if Gidiplus would conduct its business in a broadly compliant manner. Earlier the FCA had also published in June 2021 a list of 111 UK-based crypto companies that were unregistered with the FCA for anti-money laundering compliance and were conducting operations. These crypto firms were shut down and are no longer operational.

The FCA’s order concluded that it regularly sends out warnings to consumers regarding the high-risk and unregulated nature of crypto assets. The FCA also stated in the notice that the risk of crypto assets makes it more likely to affect people as firms do not implement any safeguards in case things go sideways.

Suggested read: FCA Imposed a $1.05M fine on Barclays Bank for “Oversight Failings”