U.K. FCA Adds Crypto Firms to Crime Reporting List
- The FCA now requires “all crypto asset exchange providers and custodian wallet providers” to submit annual financial crime reports.
- The move follows the regulator’s plan to increase its regulatory oversight in the crypto space, which began in January 2020.
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The United Kingdom’s Financial Conduct Authority (FCA) has added crypto businesses to its list of companies required to submit financial crime reports, the FCA said in a policy statement on 31 March.
According to the announcement, the move has increased the number of businesses that are required to submit annual financial crime reports from 2,500 to around 7,000. Also known as “REP-CRIM”, these businesses now include “all crypto asset exchange providers and custodian wallet providers” that are under the FCA’s supervision. Multilateral trading facilities (MTFs), organized trading facilities (OTFs) and electronic money institutions will also be affected.
The FCA’s intentions were first announced in August 2020, when the regulator said it was planning to increase the number of firms required to report on financial crimes as part of its effort to adopt data-focused approach to fintech regulation. The increased supervision was an attempt to better combat money laundering activities. The FCA also said in its 2020/2021 business plan:
“We will invest in new technologies and skills so that we can make better use of data to regulate efficiently and effectively. We will strengthen our rules to prevent money laundering, as well as working with domestic and international stakeholders to support a joined-up approach to cryptoassets.”
The introduction of crypto businesses to the “REP-CRIM” reporting list follows the FCA’s plan to increase its regulatory oversight on the crypto space. The U.K. regulator made it mandatory for digital asset firms to register with it back in January 2020, shortly after it was appointed as the direct regulator for crypto businesses in the country. While the initial deadline for registration was 10 January 2021, it was extended by six months — to 9 July 2021 — as the regulator had fallen behind schedule on reviewing applications due to the coronavirus restrictions on visits.
- The U.K. Financial Conduct Authority continues its crackdown on crypto ATMs in the country, and has disrupted a total of 26 machines since the start of the year.
- The regulator warned the public back in March 2022 that all crypto ATMs in the country were operating illegally, and issued a “shut down or face further action” order.
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- Unnamed sourced told the Financial Times that the U.K. Treasury was preparing new rules that would give the FCA broader powers over the crypto market.
- The regulations will allow the FCA to monitor and limit operations and advertising of crypto companies, as well as restrict crypto sales in the U.K. from foreign companies.
- The Financial Conduct Authority has warned investors that crypto exchange FTX “may be providing financial services without authorization” in the U.K..
- A spokesperson for FTX said the exchange believed it was impersonated by a scammer, as the phone numbers provided by the FCA were not connected to it.