London authorities have apprehended two individuals suspected of operating an illicit cryptocurrency exchange, believed to have facilitated trades exceeding £1bn in unregistered crypto assets.
The Financial Conduct Authority (FCA) conducted a search of the suspects’ London offices, while the Metropolitan Police confiscated digital devices from two residences in the city.
The exchange, allegedly run by the 38 and 44-year-old suspects, is thought to have enabled the trading of over £1bn in unregistered crypto assets.
After being questioned under caution, both suspects were released on bail. The FCA confirmed that the investigation is ongoing.
Therese Chambers, Executive Director of Enforcement and Market Oversight at the FCA, stated, “The FCA plays a crucial role in preventing dirty money from infiltrating the UK financial system. These arrests demonstrate our commitment to halting the illegal operation of crypto firms in the UK.”
These arrests come amid a global clampdown on crypto companies, following the downfall of major firms in the sector, resulting in millions losing their crypto investments.
The highly publicized collapse of FTX, led by Sam Bankman-Fried, resulted in a 25-year prison sentence for the mogul in the US for defrauding customers and investors.
Changpeng “CZ” Zhao, Binance’s founder, was sentenced to four months in prison in April for facilitating money laundering on his platform, to which he pleaded guilty. Despite Zhao’s resignation from Binance in November, the exchange remains operational and is the world’s largest by transaction volumes.
The FCA maintains a registry of authorized crypto companies permitted to operate in the UK, currently listing 45 companies, including crypto ventures by financial giants like Fidelity, Standard Chartered, and Nomura.
However, the regulator’s list of suspected illegal crypto businesses operating in the UK contains over 13,000 companies. The FCA also requires registered crypto firms to demonstrate compliance with UK money laundering regulations to operate legally.
