Illegal crypto ATM network busted in UK, two under investigation

U.K. authorities have arrested two individuals and seized multiple crypto ATMs in connection with an investigation into an unregistered cryptocurrency exchange and suspected financial crime.

According to a statement from the UK Financial Conduct Authority (FCA), the operation was carried out in partnership with the Metropolitan Police. Officers searched four premises across southwest London, leading to the seizure of seven crypto ATMs.

The FCA confirmed that the suspects were interviewed under caution and have been released while investigations continue. No charges were filed yet, and an inquiry is still ongoing.

Per the FCA, it is illegal to operate a cryptoasset exchange or a crypto ATM in the UK without proper registration. All firms must comply with anti-money laundering regulations, which include customer due diligence and source-of-funds checks.

Therese Chambers, the FCA’s executive director of enforcement and market oversight, said there are currently no legally operated crypto ATMs in the UK, adding that the use of unregistered machines “only supports crime” and warned operators to expect serious consequences.

The FCA has maintained a strict stance against illegal crypto ATM operations. Since January 2021, any crypto business operating in the UK must be registered with the FCA. 

The agency acts as the anti-money laundering supervisor for crypto service providers and has repeatedly warned the public about the risks associated with unregulated crypto machines.

This week’s arrests follow the UK’s first criminal sentencing involving unregistered crypto ATMs earlier this year. In that case, Olumide Osunkoya was sentenced to four years in prison for running a £2.5 million crypto ATM network through his company, GidiPlus.

Osunkoya continued operating despite being denied FCA registration and was found guilty of using false identity documents, forgery, and possession of criminal property. Authorities also found that his machines bypassed basic financial safeguards and charged markups of up to 60%.

While crypto ATMs remain banned in the UK, other countries are adopting varied approaches. In the United States, over 29,000 crypto ATMs are in operation, but regulatory scrutiny is increasing. 

States like Nebraska have imposed licensing rules, transaction caps, and scam refund mandates, while Washington’s Spokane city has moved to outright ban crypto ATMs.

Elsewhere, New Zealand has implemented a full ban on crypto ATMs. More recently, Australia also introduced tighter controls earlier this month, including per-transaction cash limits and mandatory scam warnings, following multiple high-value fraud cases linked to Bitcoin ATMs.