FCA Issues Another Warning About Using Crypto ATMs
- FCA regulations require all crypto exchanges and ATMs to register and comply with money laundering regulations.
- The FCA has warned that all crypto ATMs in the UK are illegal.
- The UK regulator also warned that people using crypto ATMs could lose their funds and would not be protected by the government or compensated by the operators.
The United Kingdom’s Financial Conduct Authority (FCA) said it has “disrupted” 26 of the 32 crypto ATMs it has inspected since the start of the year. The financial regulator made these revelations in a press release it shared on Tuesday, July 11.
The FCA began a raid against several locations around the U.K. that were thought to have unlawful cryptocurrency earlier this year. The agency previously said in May that it would start conducting more thorough inspections of crypto ATMs, and as of last month, the FCA had investigated 18 locations.
Steve Smart, joint executive director of enforcement and market oversight at the FCA, warned against the use of crypto ATMs in the UK. He noted that victims of scams involving crypto ATMs will not be protected by the government or the operators of the machines. Smart said,
If you use a crypto ATM in the U.K., 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 FCA’s raid against crypto exchanges has been in collaboration with the South West Regional Organized Crime Unit and police units from Greater London, Bedfordshire, and Hertfordshire. These raids come a year after the FCA issued a “shut down or face further actions” notice in March 2022, informing the public that all cryptocurrency ATMs operating in the nation were illegal since their operators had neglected to register with the watchdog.
The FCA believes crypto ATMs pose a serious risk to the public. The regulator previously cited a situation where an individual attempted to purchase £1,000 worth of cryptocurrency but was unable to retrieve his money even though the transaction was unsuccessful as evidence of how detrimental cryptocurrency ATMs are to the public.
Last week, the Clive Police Department shared how con artists pretended to be law enforcement officers and employed frightening techniques to trick people into transferring money through cryptocurrency ATMs.
I have covered some exciting stories in my career as a journalist and find blockchain-related stories very intriguing. I believe Web3 will change the world and want everyone to be a part of it.
