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UK report lists crypto firms as high-risk for money laundering in 2022-2023



UK report lists crypto firms as high-risk for money laundering in 2022-2023

A report from the U.K. Treasury shows that cryptocurrency businesses, wealth management firms, and both retail and wholesale banks face a heightened risk of financial crime.

The United Kingdom’s leading financial regulator indicates that crypto firms are at the greatest risk of being used for money laundering.

A report released on May 1 by the U.K. Treasury, based on information from the Financial Conduct Authority (FCA), identifies crypto-asset companies as among the top four types of firms most vulnerable to financial crime, especially money laundering, between 2022 and 2023.

The report mentions cryptocurrency firms alongside retail banks, wholesale banks, and wealth management companies.

The report states that between 2022 and 2023, 52.8 full-time specialists handled Anti-Money Laundering cases, with nearly one-third focusing specifically on monitoring crypto firms.

Between 2022 and 2023, the FCA’s financial crime team conducted 231 reviews of financial businesses operating in the U.K. and investigated an additional 375 cases related to financial crime and sanctions breaches.

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As part of a broader supervision strategy beyond these reviews, FCA teams opened 95 investigations into British crypto companies.

Britain has been working toward clearer laws for local crypto firms, and on April 16, the U.K. Treasury announced plans to introduce a complete regulatory framework for crypto assets and stablecoins by July.

On April 26, the U.K.’s National Crime Agency (NCA) and police gained expanded power to “seize, freeze, and destroy” cryptocurrencies used in criminal activities. Under the new rules, police in the U.K. can seize crypto assets without having to make an arrest first.

Additionally, U.K. law enforcement can now seize items such as passwords and memory sticks that might be useful in investigations.

The new regulations also authorize them to prevent crypto assets from re-entering circulation, usually by destroying the asset, if it’s considered harmful to the public interest.

The updated regulations let U.K. police transfer seized illegal cryptocurrency into wallets they control, and crime victims can ask to have their funds returned from their crypto accounts.

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