Operators of illegal crypto currency ATMs in Leeds have been told to stop their activities following a joint investigation between the Financial Conduct Authority (FCA) and West Yorkshire Police.
In what is thought to be a national first, the regulator joined forces with the force's Digital Intelligence and Investigation Unit, using powers to enter and inspect a number of locations around the city where illegal ATMs were thought to be in use. Operators have been warned they face investigation under money-laundering regulations if they do not close the machines.
Crypto ATMs allow customers to buy or convert funds into cryptoassets. Providers of such exchanges must be registered with the FCA to comply with UK money laundering regulations. At the moment, no crypto ATM operators are FCA registered.
Read more: Investigation launched into PwC audit of failed shopping centre group Intu
Mark Steward, executive director of Enforcement and Market Oversight at the FCA, said: "Unregistered Crypto ATMs operating in the UK are doing so illegally. We will continue to identify and disrupt unregistered crypto businesses operating in the UK.
"Crypto businesses operating in the UK need to be registered with the FCA for anti-money laundering purposes. However, crypto products themselves are currently unregulated and high-risk, and you should be prepared to lose all your money if you invest in them."
Det Sgt Lindsey Brants of the Force Cyber Team at West Yorkshire Police said: "Having conducted intelligence gathering work across West Yorkshire, we soon established the locations of several live crypto ATMs. Warning letters were issued requesting the operators cease and desist using the machines and that any breach of regulations would result in an investigation under money-laundering regulations. We then shared our findings with the Financial Conduct Authority.
"We are pleased to be able to work in partnership with the FCA in what we believe is a national first here in West Yorkshire."
The FCA publishes a list of businesses that it suspects are operating without its authorisation.
READ NEXT:
