Crypto Firms Identified as Top Money Laundering Risk, UK Government Report Reveals:
According to a report by the government’s financial arm released on Wednesday, crypto firms, along with retail banking, wholesale banking, and wealth management sectors, emerged as the highest risk sectors for potential exploitation in money laundering activities between 2022 and 2023.
The findings were drawn from Financial Conduct Authority (FCA) risk assessments conducted on 238 firms. The FCA, serving as the financial regulator in the U.K., has been actively overseeing the registration and compliance of crypto firms with its stringent money laundering regulations since 2020.
The U.K. has been intensifying efforts to combat crypto-related crimes in recent times. In October 2022, the U.K. police deployed crypto tactical advisors across the nation to facilitate the seizure of digital assets associated with criminal activities. This initiative proved fruitful, with the National Police Chiefs’ Council reporting the successful confiscation of hundreds of millions worth of crypto assets linked to various crimes.
Data from the newly released report revealed that between 2022 and 2023, the Financial Conduct Authority employed the equivalent of 52.8 full-time financial crime specialist employees dedicated to anti-money laundering supervision. Notably, 15.8 of these specialists were specifically focused on supervising crypto businesses.
Furthermore, outside the dedicated financial crime specialist teams, wider supervisory teams initiated 95 cases concerning crypto-assets during the reporting period. These figures underscore the growing scrutiny and regulatory attention directed towards the cryptocurrency sector as authorities ramp up efforts to mitigate financial crimes and safeguard the integrity of the financial system.
