FCA raids properties as part of investigation into unregistered peer-to-peer crypto trading
Apr 29 2026
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FCA raids properties as part of investigation into unregistered peer-to-peer crypto trading
We have been keeping a close eye on the Financial Conduct Authority’s (“FCA”) enforcement actions in relation to unregistered cryptoasset activity in the UK.
In July 2025, we wrote about the FCA seizing seven crypto ATMs and arresting two as part of an illegal cryptoasset exchange investigation.
Earlier, in March 2025, we noted how the operator of an illegal crypto ATM network was sentenced to four years in prison following another FCA investigation.
Before that, in September 2024, we wrote an article entitled “Illegal crypto ATMs: not as uncommon as you’d think” which explained that the FCA had brought its first criminal charges against an individual for alleged offences of running multiple crypto ATMs without FCA registration.
We noted that those charges marked the FCA’s first attempt to prosecute an individual in relation to unregistered cryptoasset activity under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
Below, we explore the FCA’s first action against unregistered crypto trading. The latest investigation confirms that the FCA will continue to take a hardline approach in relation to unregistered cryptoasset activity. In this instance, the action was also taken under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
Update: the latest FCA investigation
In an action coordinated with HMRC and the police, the FCA raided eight properties as part of an investigation into unregistered illegal cryptocurrency trading.
The FCA have confirmed that it had earlier issued “cease and desist letters” and that the evidence collected during on-site inspections would be used as part of ongoing investigations.
This action is the first of its kind by the FCA, which commented that “[u]nregistered peer-to-peer crypto traders operating in the UK are doing so illegally and pose financial crime risk”, and that “[w]e will use our powers and work with partners to disrupt them”. They added that they were able to investigate the activity using “market intelligence and working with our partners”.
The FCA have also noted that there are currently no FCA-registered peer-to-peer crypto traders or platforms operating in the UK.
What are the FCA registration requirements?
As we have explained in previous articles, UK AML regulations can apply to UK crypto firms that provide exchange or custodian services for cryptoassets (e.g. a crypto ATM).
In summary, businesses providing the services of exchange and/or custody of cryptoassets in the UK will be subject to the regulations and must be registered with the FCA under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
The regulations appoint the FCA as the supervisor of cryptoasset businesses for AML purposes, and business falling within the scope will need to be registered with the FCA as well as complying with all regulatory requirements.
What is the position in terms of wider crypto regulation?
In January 2026, we detailed plans for a new regime for crypto regulation in the UK:
UK crypto regulation – a new regime for cryptoasset regulation
New powers for the seizure and recovery of cryptoassets
Since April 2024, UK authorities have been granted new powers in relation to the seizure and confiscation of cryptoassets.
These have been used to a varying extent by various agencies. See, for example our article:
We have written about the Serious Fraud Office obtaining its first Crypto Wallet Freezing Order:
Serious Fraud Office secures first Crypto Wallet Freezing Order
We have also detailed these new powers in the following series of articles:
Increased reports of crypto fraud and scams – more from Gherson
We have previously published a blog entitled “What to do if you think that you have been victim to a crypto fraud or scam”. It followed earlier blogs entitled “What can you do to avoid a crypto fraud or scam?” and “What to do if your NFT has been stolen”.
NAVIGATING FINANCIAL INSTITUTION-RELATED CHALLENGES
What can I do to challenge a wrongful decision to close my personal and/or business bank account(s)?
In the meantime, we are receiving a growing number of enquiries from individuals who have been “de-banked” in circumstances when they feel that they have always acted in full compliance with the relevant bank account’s Terms and Conditions and all other legal and applicable rules and regulations.
We have previously written about how issues such as account closures are not limited to UK political figures and may affect many thousands of lawful individual and business customers every year. These cases have exposed the difficult balance many financial institutions and their individual and business customers must navigate to gain and maintain access to basic banking services.
To assist those whose accounts have been closed, Gherson’s Regulatory, White-Collar Crime and Investigations team have previously written the following blogs:
- Why has my personal bank account been closed?
- Why has my business bank account been closed?
- 140,000 SMEs “de-banked” last year – why could I have been de-banked?
- What are the proposed new laws aimed at preventing de-banking?
- Why the proposed new laws to try and prevent de-banking to not go far enough?
- Am I entitled to a basic bank account in the UK?
- How to challenge crypto-related bank account closures?
- “De-banking” and crypto – will the landscape be positively changed by the introduction of new rules for both?
What can I do to challenge a wrongfully imposed CIFAS marker
We have also been receiving a growing volume of enquiries from individuals who feel that a financial institution has wrongfully imposed a CIFAS marker in their name.
If you have always acted in full compliance with the relevant bank account’s Terms and Conditions and all other applicable legal rules and regulations, then you should have a good basis to challenge the bank’s decision to implement any CIFAS markers.
A strong challenge will often involve demonstrating through evidence that you have not breached the bank’s Terms and Conditions or any relevant rules, and that all transactions were at all times fully compliant will all applicable laws and regulations.
In a previous blog we have examined what a CIFAS marker is and how to try and get it removed, and also steps to take if a CIFAS marker has been wrongfully imposed.
We have also recently explored the topic of challenging a crypto-related CIFAS marker.
Adverse information on compliance database
We are also being increasingly approached by individuals who feel that incorrect and/or inaccurate data stored about them in compliance databases is having an adverse effect on their relationship with financial institutions and who are facing subsequent issues, such as bank account closures or difficulties in opening a bank account.
We have previously written a series of blogs covering the main functions of compliance databases like World-Check and how to correct personal information on them
HOW GHERSON CAN ASSIST
Gherson’s Regulatory, White-Collar Crime and Investigations team are highly experienced in providing assistance in situations where your bank may freeze or close your account. This includes submitting a request under data protection legislation, otherwise known as a Data Subject Access Request, to ascertain what information banks or other financial institutions may be holding on a particular individual and to understand their decision making. Following a response, we analyse it and assist with mounting an appropriate challenge.
If you would like to speak to us in respect of any of the issues raised in this blog or about your specific circumstances, do not hesitate to contact us for advice, send us an e-mail, or alternatively, follow us on X, Facebook or LinkedIn to stay-up-to-date.
The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.
©Gherson 2026
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