UK Financial Watchdog Opened 300 Crypto Cases in 6 Months, Many 'May Be Scams'

By Scott Chipolina

The UK’s Financial Conduct Authority (FCA) has announced that over the last six months, it opened over 300 cases relating to crypto asset businesses. 

These cases relate to businesses possibly not being registered with the financial authority, as well as potential scams. 

A spokesperson for the FCA told Decrypt that a crypto asset business may also have more than one case tied to it.  

The watchdog’s announcement adds that the regulator has “50 live investigations, including criminal probes, into unauthorized businesses.” An FCA spokesperson told Decrypt these live investigations don’t necessarily refer to crypto asset businesses either. 

“Consumers need to have confidence when making investment decisions and the data we’ve published today shows how prevalent scams can be,” Sarah Pritchard, Executive Director of Markets at the FCA said in a prepared statement. 

“Before investing, check you know who you are really dealing with, check if they are authorized by the FCA, and do your research to understand the risks that might be posed.” 

FCA’s uneasy relationship with crypto

The FCA is the UK’s supervisory authority when it comes to anti-money laundering and counter-terrorism financing requirements. 

Since January 2020, businesses that carry out cryptoasset activity in the UK have been required to be compliant with the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations.

Those same businesses must be registered with the FCA. 

Despite this, however, the financial watchdog has repeatedly raised consumer protection concerns as they pertain to the wider crypto industry. 

In January 2021, the FCA shared five concerns it had surrounding cryptocurrencies, including price volatility, technical complexity, and potentially misleading marketing. 

“Investing in cryptoassets, or investments and lending linked to them, generally involves taking very high risks with investors’ money. If consumers invest in these types of [sic] product, they should be prepared to lose all their money,” the FCA said. 

The FCA has also taken aim at specific crypto exchanges. 

Last year, the regulator raised concerns over Binance’s apparent lack of a headquarters, and months later doubled down, claiming Binance was not capable of being regulated after it failed to provide the financial authority with “basic information” about the exchange. 

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