Since 2022, the UK Financial Conduct Authority (FCA) has stepped up its crackdown on unlicensed cryptocurrency ATMs, warning consumers of potential risks.
The United Kingdom’s Financial Conduct Authority (FCA) continues its crackdown on unlicensed cryptocurrency ATMs. Working in partnership with multiple law enforcement agencies, the FCA conducted a series of inspections in May and June, destroying 26 machines that were operating illegally across the United Kingdom.
Steve Smart, joint executive director of enforcement and market oversight at the FCA, issued a stern warning to crypto ATM users:
“If you use a cryptocurrency ATM in the UK, you are using a machine that is operating illegally and you could be handing your money over to criminals.”
Smart stressed that the lack of effective communication channels with crypto ATM operators has further exacerbated instances of crypto ATM customers losing money and/or being defrauded.
One incident that illustrates Smart’s warning involves a citizen who lost £1,000 in a failed transaction at a crypto ATM in Sheffield. Despite the machine showing the transaction was unsuccessful, the customer’s funds were not returned. The only contact information provided for the machine operator was a WhatsApp number, but the user was unable to reach that number. Following an FCA inspection, the ATM was deactivated.
Since 2022, the FCA has frequently warned the public about the risks associated with unauthorized cryptocurrency ATMs in the UK and threatened to close ATMs to prevent further money laundering schemes.
Consumers are reminded that they are not protected from scams or other adverse circumstances when using these machines:
“We have concerns about crypto ATMs operating in the UK and will therefore be contacting operators with instructions to shut down these machines or face further action.”
Although there are more than 40 registered cryptocurrency companies in the UK, none of them hold a license to provide ATM services, making any operating cryptocurrency ATMs illegal. However, data website Coin ATM Radar lists 10 active cryptocurrency ATMs in the country.
