The Financial Conduct Authority (FCA), the financial regulator of the United Kingdom, has taken action against cryptocurrency ATMs, disrupting 26 out of the 34 machines it visited and inspected since the beginning of 2023.
On February 14th, the FCA issued an ultimatum to all crypto ATM operators in the country, stating that they must comply with regulations or cease their illegal operations.
In response to this warning, the FCA, along with other law enforcement agencies, conducted investigations into 36 crypto ATM locations using their authority under money laundering regulations.
Steve Smart, the joint executive director of enforcement and market oversight at the FCA, spoke out against the use of all crypto ATMs, highlighting the risks involved.
READ MORE: Crypto Firms Struggle to Attract Local Talent in Hong Kong Despite Regulatory Changes
He emphasized that using a crypto ATM in the UK means utilizing a machine that is operating illegally, and users may unknowingly be handing their money over to criminals.
Smart further clarified that victims of scams involving these ATMs, specifically those related to cryptocurrencies like Bitcoin (BTC), will not receive government protection or assistance from the ATM operators.
Between May and June, the FCA inspected 18 of these locations, coinciding with their public announcement about the initiation of their inspection campaign.
It is worth noting that all crypto exchanges and ATMs in the UK are required to register with the FCA and comply with the country’s money laundering regulations.
On July 8th, the Clive Police Department released a report detailing a crypto scam in which a fraudster posed as a law enforcement representative and managed to steal $6,000 from an unsuspecting victim while threatening them with an arrest warrant.
Scammers often employ fear tactics and impersonate law enforcement officials to deceive individuals into transferring funds through crypto ATMs.
However, it is important to remember that legitimate law enforcement agencies never demand payments over the phone or through cryptocurrency.
The FCA’s efforts to disrupt illegal crypto ATM operations and raise awareness about the risks associated with them are aimed at safeguarding the public and preventing financial crimes.
Individuals are urged to exercise caution and verify the legitimacy of any communication or transaction involving cryptocurrency to protect themselves from falling victim to scams.
