Key Takeaways
- • The FCA conducted its first coordinated enforcement operation targeting illegal peer-to-peer crypto trading, working with HMRC and the South West Regional Organised Crime Unit to raid 8 London premises on April 22, 2026.
- • The FCA issued cease-and-desist letters at all targeted sites and gathered evidence supporting multiple ongoing criminal investigations into unregistered crypto traders operating in the UK.
- • Zero FCA-registered peer-to-peer crypto trading platforms currently operate in the UK; all peer-to-peer crypto trading activity identified is operating illegally and poses financial crime risks including money laundering.
- • Steve Smart, FCA executive director of enforcement and market oversight, emphasized that unregistered peer-to-peer traders pose financial crime risks and stated the regulator will use enforcement powers and partner cooperation to disrupt illegal activity.
- • The operation signals escalating regulatory enforcement against crypto market participants operating outside the formal registration framework, with law enforcement targeting use of unregulated traders as conduits for criminal money movement.
Summary
The Financial Conduct Authority has launched its first coordinated enforcement operation against illegal peer-to-peer cryptocurrency trading in the UK, targeting eight premises across London in partnership with HM Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU). The multi-agency operation, conducted on April 22, 2026, represents a significant escalation in the FCA's enforcement posture against unregistered crypto activity and demonstrates coordinated effort across tax, law enforcement, and financial regulatory authorities.
During the raids, the FCA issued cease-and-desist letters at each targeted site, formally notifying traders to halt illegal activity immediately. Evidence collected during the on-site inspections is actively supporting a number of ongoing criminal investigations, indicating that this operation serves dual purposes: immediate disruption and building cases for prosecution. Critically, peer-to-peer trading—where individuals buy and sell cryptocurrency directly without using centralized exchanges—requires appropriate FCA registration. The FCA confirmed that currently, zero peer-to-peer crypto traders or platforms hold FCA registration in the UK, meaning all such activity identified is by definition operating illegally.
Steve Smart, the FCA's executive director of enforcement and market oversight, framed unregistered peer-to-peer crypto traders as posing "financial crime risk" and committed to using "our powers and work with partners to disrupt them." Law enforcement representatives echoed this concern, with Detective Inspector Ross Flay of SWROCU emphasizing that unregistered peer-to-peer traders provide "a route for criminals to move, disguise and spend illegal money." This language reflects law enforcement priorities around money laundering and financial crime prevention alongside consumer protection messaging.
The operation builds on prior FCA enforcement actions, including prosecution of an individual operating an illegal crypto ATM network and a June 2024 joint operation with the Metropolitan Police Service that resulted in the arrest of two individuals suspected of running an illegal cryptoasset exchange. The FCA's statement cautioning consumers to "only deal with firms registered with the FCA" and reminding investors that "crypto remains a high risk investment" suggests the regulator views consumer education as part of its broader enforcement strategy to contract the unregulated crypto trading market.
During the raids, the FCA issued cease-and-desist letters at each targeted site, formally notifying traders to halt illegal activity immediately. Evidence collected during the on-site inspections is actively supporting a number of ongoing criminal investigations, indicating that this operation serves dual purposes: immediate disruption and building cases for prosecution. Critically, peer-to-peer trading—where individuals buy and sell cryptocurrency directly without using centralized exchanges—requires appropriate FCA registration. The FCA confirmed that currently, zero peer-to-peer crypto traders or platforms hold FCA registration in the UK, meaning all such activity identified is by definition operating illegally.
Steve Smart, the FCA's executive director of enforcement and market oversight, framed unregistered peer-to-peer crypto traders as posing "financial crime risk" and committed to using "our powers and work with partners to disrupt them." Law enforcement representatives echoed this concern, with Detective Inspector Ross Flay of SWROCU emphasizing that unregistered peer-to-peer traders provide "a route for criminals to move, disguise and spend illegal money." This language reflects law enforcement priorities around money laundering and financial crime prevention alongside consumer protection messaging.
The operation builds on prior FCA enforcement actions, including prosecution of an individual operating an illegal crypto ATM network and a June 2024 joint operation with the Metropolitan Police Service that resulted in the arrest of two individuals suspected of running an illegal cryptoasset exchange. The FCA's statement cautioning consumers to "only deal with firms registered with the FCA" and reminding investors that "crypto remains a high risk investment" suggests the regulator views consumer education as part of its broader enforcement strategy to contract the unregulated crypto trading market.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.