Crypto ATMs Seized in UK Money-Laundering Probe

A British regulator has seized seven cryptocurrency ATMs in a money laundering investigation.

The seizures came as part of an operation by the Financial Conduct Authority (FCA) and Metropolitan Police Service in London, in which four locations were searched and two people arrested, the FCA announced Thursday (July 17).

“If you’re operating a crypto ATM or exchange illegally, then you should expect serious consequences,” Therese Chambers, executive director of enforcement and market oversight at the FCA, said in a news release. “There are currently no legally-operated crypto ATMs in the UK, so using one only supports crime. We will continue to partner with law enforcement agencies to fight financial crime and protect consumers.”

Added Detective Inspector Geoff Donoghue, of the Met’s Cryptocurrency Team: “Our team is committed to working alongside our partners to address the growing threat of the misuse of cryptocurrencies. As cryptocurrency usage evolves, so does our efforts to safeguard our communities. This operation with the FCA shows our determination to keep Londoners safe from financial criminals.”

As their name suggests, crypto ATMs allow users to purchase crypto by inserting cash or a card and having the digital tokens sent to their wallet. Many countries have imposed regulations or warnings over the machines due to their popularity with criminals.

For example the U.S. Federal Trade Commission (FTC) said last year that bitcoin ATMs had become a “payment portal for scammers” as they’ve increased in popularity.

The amount of money consumers lost in scams involving these machines ballooned between 2020 and 2023, from $12 million to $114 million, the commission said, adding that because most frauds go unreported, the $114 million figure likely reflects only a fraction of the losses.

“The lies told by scammers vary, but they all create some urgent justification for consumers to take cash out of their bank accounts and put it into a bitcoin ATM,” the FTC said in a news release at the time. “As soon as consumers scan a QR code provided by scammers at the machine, their cash is deposited straight into the scammer’s crypto account.”

More recently, the government of New Zealand proposed a ban on crypto ATMs. Nicole McKee, the country’s associate justice minister, said this move would make it “more difficult for criminals to convert cash to high-risk assets such as cryptocurrencies.”