UK’s FCA investigated 300 crypto firms in 2021
United Kingdom’s FCA received over 16,000 inquiries about possible scams between April to September last year. The watchdog received more than 16,400 inquiries about possible scams between April to September last year. Crypto scams were the majority of these. This led it to investigate potential crypto scam businesses, opening 300 cases.
The UK Financial Conduct Authority (FCA) has announced that it would double down on its efforts to prevent investors from coming to harm. It stated this in a press release which also detailed its plans for regulations and achievement in the past few months.
But not all these cases involved actual scams. In many cases, they were unregistered securities. Presently, 50 of those cases are under investigation for connection to unauthorized business activities and crimes.
This report shows the extent of unregulated crypto activities in the UK and the herculean task ahead for the commission.
The FCA consumer data review report shows that the body was able to stop the registration of 1 in 4 firms due to the suspicious backgrounds of the team. It has also blacklisted 172 firms, adding them to its list of unregistered crypto businesses.
However, a lot more still depends on the consumers. According to Sarah Pritchard, the executive director of markets at the FCA,
Consumers need to have confidence when making investment decisions, and the data we’ve published today shows how prevalent scams can be. Before investing, check if you know who you are really dealing with, check if they are authorized by the FCA, and do your research to understand the risks that might be posed.
UK to strengthen crypto regulations
Like most countries around the world, the regulations surrounding the crypto industry is still largely unclear in the United Kingdom. But with the risk posed by unregulated crypto assets and the prevalence of crypto-related scams in the country, the authorities might want to strengthen it further.
In January, the regulatory body allowed public consultations on some of its proposals and will accept feedback till March 23. One of the proposals is to apply its financial promotion rules for high-risk investments assets, including crypto.
At the moment, any firm providing crypto services to UK users must register with the authorities. While 32 firms have already been approved as registered crypto asset service providers, a lot more exist without proper registration.
It should be noted that the UK’s Advertising Standards Authority (ASA) has also been taking a hardline stance towards the crypto industry. Last year, the body banned over 20 crypto ads for being misleading or not providing enough information about the risk of crypto investments.