According to a statement from the Financial Conduct Authority (FCA), the 45-year-old Mr. Osunkoya became the first ever individual to be charged by the FCA for the illegal operation of crypto ATMs. The September 10 statement revealed that Mr. Osunkoya had operated the crypto ATMs without the FCA’s approval for over 20 months.
The statement showed that the FCA had charged Mr. Osunkoya with criminal offenses relating to unregistered crypto-asset activity under the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations 2017 (MLRs). Mr. Osunkoya was charged with the unregistered processing of £2.6 million (~$3.4M) in crypto transactions across different locations under GidiPlus Ltd.
The FCA goes for the first individual for illegal crypto ATM business
We've charged Mr Olumide Osunkoya for unlawfully running multiple crypto ATMs without FCA registration. #CryptoATM #CryptoNews #FinancialRegulationhttps://t.co/eVWEvnMbUw
— Financial Conduct Authority (@TheFCA) September 10, 2024
The regulator disclosed that Mr. Osunkoya would be charged with two offenses under Regulations 86 and 92 of the MLRs for running crypto ATMs without registering with the FCA. The regulator added that Mr. Osunkoya would also be charged with two offenses under the Forgery and Counterfeiting Act 1981 relating to the creation and use of false documents for illegal activity.
The FCA affirmed that Mr. Osunkoya would be charged with the possession of criminal property under the Proceeds of Crime Act 2002 relating to the alleged revenue accrued from his crypto ATM network.
According to the U.K. regulator, the London-based Mr. Osunkoya was preparing to appear before the Westminster Magistrates’ Court on September 30. According to the FCA, Mr. Osunkoya was the first individual to be charged for the illegal operation of a crypto ATM network after another 37-year-old Londoner, Habibur Rahman, was arrested on April 28, 2023, by the Kent Police and charged with running a single unregistered crypto ATM.
The U.K. regulator also mentioned that there were no FCA-registered crypto ATMs in the U.K., so it warned people that they should be prepared to lose all their money anytime they decided to buy or sell crypto-assets through crypto ATMs because they remained largely unregistered in the U.K. thus considered high-risk.
“If you’re using a crypto ATM, you are handing your money directly to criminals. Criminals can exploit crypto ATMs to launder money globally.”
–Therese Chambers
Chambers, the joint executive director of enforcement and market oversight at the FCA, asserted that the FCA’s message on stopping all illegal crypto ATM operators was clear. According to the regulator, none of the 44 registered crypto companies were approved to run a crypto ATM in the United Kingdom.
The FCA engages other law enforcement agencies to nab illegal crypto ATM businesses
The U.K. regulator pointed out that it had inspected 34 suspected locations across the U.K., where 26 machines operating illegally had been disrupted. According to the regulator, it carried out raids in May 2023 across various sites in Sheffield, Exeter, and Nottingham. The Kent Police, in a collaboration effort with the regulator, conducted a search at the Gadcet shop in High Street Chatham, where several crypto ATMs (including one displayed in public) were confiscated.
The FCA also disclosed that it continued to work with law enforcement agencies such as the Bedfordshire Police, Metropolitan Police, Hertfordshire Police, and the South West Region Organised Crime Unit.
Notably, the FCA declared that the directors or senior officers of companies charged with committing an offense under Regulation 92 of the MLRs were also guilty of the underlying offense, whether committed with the officer’s connivance or consent or any neglect on the part of the officer.