In short
- The UK Financial Conduct Authority led multi-agency raids on eight locations in London suspected of engaging in illegal P2P crypto trading.
- The authorities issued a cease and desist order which called for the end of the illegal trade.
- The evidence gathered will help the ongoing criminal investigation into the alleged money laundering operations, the agencies said.
The UK Financial Conduct Authority he said on Wednesday that it had carried out its first anti-trafficking raids, hitting eight locations in London with tax authorities and forensic teams.
Tuesday morning’s operation saw FCA officials issue cease-and-desist letters to every location, ordering traders to immediately stop illegal activities. The offenses were committed under the Money Laundering, Money Laundering and Transfer of Funds Regulations 2017.
The evidence found during the on-site inspection is now helping the criminal investigation, the director said. The incident involved HM Revenue & Customs and the South West Regional Organized Crime Unit working alongside FCA teams. Officials from these organizations emphasized the crime risks posed by unregistered workers.
“Unregistered peer-to-peer crypto traders operating in the UK are doing so illegally and pose a serious financial crime risk,” said Steve Smart, FCA’s director of operations and market oversight, in a statement. “We will use our power and work with our partners to disrupt it.”
Detective Inspector Ross Flay of the South West Regional Organized Crime Unit highlighted concerns about the money laundering scheme.
“By working with our colleagues at the FCA and HMRC, we are able to effectively track and crack down on unregistered crypto peer traders who are operating illegally,” Flay said. “As law enforcement, we want to stop these merchants from providing a means for criminals to move, hide, and spend illegal money.”
The attack marks a major uptick in crypto addiction in the UK. The FCA currently has zero peer-to-peer registrations or platforms operating legally in the country, meaning all P2P transactions operate outside of the regulator.
P2P platforms often allow users to exchange digital assets directly, often using cash or bank transfers. These behaviors have drawn the attention of financial regulators around the world who are concerned about the problem of money laundering. Tuesday’s joint raid is the FCA’s first sign of a stronger crackdown on the sector after years of warning against unregistered crypto businesses.
Earlier this month, FCA started a discussion on crypto-driven services, covering areas such as stablecoin issuance, trading platforms, storage, and staking. Crypto companies can start applying for a license from September 2026, with the entire regulatory system in place in October 2027.
The consultation closes June 3, with final regulations expected in the summer of 2026. DeFi and distributed ledger regulations will be addressed separately over the course of a year.
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