FCA Opens over 300 Cases against Unregistered Crypto Firms

Thursday, 03/03/2022 | 13:12 GMT by Arnab Shome
  • Scams are rampant using cryptocurrencies, boiler rooms and recovery rooms.
  • It has started two campaigns to aware investors of scams.
FCA

The UK’s Financial Conduct Authority (FCA) announced on Thursday that it is taking assertive action against the rampant financial scams in the consumer investment market. In addition, it has alarmed investors against scams involving crypto assets, boiler rooms and recovery rooms.

Additionally, the financial market supervisor said that it has received 16,400 inquiries between April and September last year about possible scams, a figure that is around 30 percent higher than the previous year.

In response, the regulator has opened more than 300 cases related to un-registered crypto-asset businesses, many of which are suspected to be scams. The regulator already has 50 live investigations against these crypto companies that even include criminal probes.

“Consumers need to have confidence when making investment decisions, and the data we’ve published today shows how prevalent scams can be,” said Sarah Pritchard, FCA’s Executive Director of Markets.

Crypto Firms Are the Target

The FCA mandated all crypto companies operating in the United Kingdom register themselves with the agency. It received hundreds of requests from the crypto service providers, but the approval process turned out to be very slow. To date, only a few companies have received the approval of the British regulator.

Furthermore, the regulator said that it has stopped a quarter of applications from firms wanting to join the consumer investment market, which is a proportion that is up from 1 in 5 in the last financial year.

“Addressing the risk of harm at the authorization stage prevents firms that do not meet the FCA’s minimum standards from entering the regulatory perimeter,” the regulator added. “It also helps prevent problems further down the line which may require supervision or enforcement action.”

The UK’s Financial Conduct Authority (FCA) announced on Thursday that it is taking assertive action against the rampant financial scams in the consumer investment market. In addition, it has alarmed investors against scams involving crypto assets, boiler rooms and recovery rooms.

Additionally, the financial market supervisor said that it has received 16,400 inquiries between April and September last year about possible scams, a figure that is around 30 percent higher than the previous year.

In response, the regulator has opened more than 300 cases related to un-registered crypto-asset businesses, many of which are suspected to be scams. The regulator already has 50 live investigations against these crypto companies that even include criminal probes.

“Consumers need to have confidence when making investment decisions, and the data we’ve published today shows how prevalent scams can be,” said Sarah Pritchard, FCA’s Executive Director of Markets.

Crypto Firms Are the Target

The FCA mandated all crypto companies operating in the United Kingdom register themselves with the agency. It received hundreds of requests from the crypto service providers, but the approval process turned out to be very slow. To date, only a few companies have received the approval of the British regulator.

Furthermore, the regulator said that it has stopped a quarter of applications from firms wanting to join the consumer investment market, which is a proportion that is up from 1 in 5 in the last financial year.

“Addressing the risk of harm at the authorization stage prevents firms that do not meet the FCA’s minimum standards from entering the regulatory perimeter,” the regulator added. “It also helps prevent problems further down the line which may require supervision or enforcement action.”

About the Author: Arnab Shome
Arnab Shome
  • 6404 Articles
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About the Author: Arnab Shome
Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.
  • 6404 Articles
  • 81 Followers

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