FCA seizes seven crypto ATMs and arrests two as part of illegal crypto asset exchange investigation

In March 2025, we noted how the operator of an illegal crypto ATM network was sentenced to four years in prison following a Financial Conduct Authority (“FCA”) investigation.

Earlier, in September 2024, we wrote an article entitled “Illegal crypto ATMs: not as uncommon as you’d think”, which stated that the FCA had brought the first criminal charges against an individual for alleged offences of running multiple crypto ATMs without FCA registration.

We noted how this marked the FCA’s first attempted prosecution against an individual relating to unregistered cryptoasset activity under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

Update: latest FCA investigation

On 17 July 2025, the FCA reported that two individuals had been arrested on suspicion of money laundering and running an illegal cryptoasset exchange.

This was part of an operation led by the FCA and the Metropolitan Police Service, during which four premises across southwest London were searched. During the searches, seven crypto ATMs were also found and seized.

Therese Chambers, Executive Director of Enforcement and Market Oversight at the FCA, said:

“If you’re operating a crypto ATM or exchange illegally, then you should expect serious consequences. There are currently no legally-operated crypto ATMs in the UK, so using one only supports crime. We will continue to partner with law enforcement agencies to fight financial crime and protect consumers”.

Detective Inspector Geoff Donoghue, from the Met’s Cryptocurrency Team, said:

“Our team is committed to working alongside our partners to address the growing threat of  misuse of cryptocurrencies. As cryptocurrency usage evolves, so do our efforts to safeguard our communities. This operation with the FCA shows our determination to keep Londoners safe from financial criminals”.

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 of custodian services for cryptoassets (e.g. a crypto ATM).

This is on the basis that the UK Government has transposed AML requirements relating to cryptoassets into national law. We have provided more details on ongoing UK regulation here:

UK crypto regulation – a much-needed update on the current state of UK crypto regulation

In summary, businesses providing the services of exchange and/or custody of a cryptoasset 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 businesses in scope will need to be registered with the FCA, and will need to comply with all regulatory requirements.

New powers for seizure and recovery of cryptoassets

Since April 2024, UK authorities have been granted new powers in relation to the seizure and confiscation of cryptoassets. However, these have been used by various agencies to varying extents:

How much have the Serious Fraud Office and HM Revenue and Customs used Crypto Wallet Freezing and Forfeiture Orders since their April 2024 introduction?

It is encouraging to see that the Serious Fraud Office has recently obtained 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:

https://www.gherson.com/blog/what-is-a-crypto-wallet-freezing-order/

https://www.gherson.com/blog/how-will-measures-in-the-economic-crime-and-corporate-transparency-act-2023-assist-law-enforcement-in-seizing-and-recovering-crypto-assets/

Can UK law enforcement seize cryptoassets? – Gherson LLP

Increased reports of crypto fraud and scams – More from Gherson

The team have previously written a blog entitled what to do if you think that you have fallen victim to a crypto fraud or scam. This followed an earlier blog entitled what can you do to try and help avoid a crypto fraud or scam and a further blog entitled what to do if your NFT has been stolen.

Criminal investigations and litigation

Gherson’s criminal litigation, regulatory and investigatory team combine an expert knowledge of criminal and regulatory law underpinned by a firm understanding of digital assets and blockchain technology.  As such, the team are able to provide expert strategic advice to anyone wanting to investigate and pursue a potential theft of cryptoassets.

The team are also able to provide advice to anyone facing investigation in relation to any allegation of criminality involving cryptoassets.

Regulation and compliance

Within the constantly evolving regulatory framework, firms that deal with cryptoassets (and have exposure to firms that do) will need to consider all their systems and controls carefully to ensure that they are able to comply with all relevant AML and sanctions regulations. Gherson’s white-collar crime and regulatory team are able to provide advice and assistance with AML and sanctions compliance, including in situations involving cryptoassets.

Please do not hesitate to contact us for further advice, send us an e-mail, or alternatively, follow us on X 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 2025