First UK Conviction for Illegal Cryptocurrency ATM Operations

The United Kingdom has registered its first-ever conviction for the illegal operation of cryptocurrency ATMs. The individual responsible, Olumide Osunkoya, pleaded guilty on Monday to running an unregistered network of cryptocurrency ATMs across the country, processing millions in transactions despite being denied registration by the UK’s Financial Conduct Authority (FCA) in 2021.

The FCA revealed that the accused was facing five charges at Westminster Magistrates’ Court in a landmark case under the UK’s anti-money laundering laws. His illegal network operated at least 11 cryptocurrency ATMs that processed more than £2.6 million (around $3.5 million) in crypto transactions between December 2021 and September 2023.

An Underground Operation Despite Warnings

Despite the FCA rejecting the operator’s registration request in 2021, he continued to run and expand the ATM network, installing machines in various convenience stores across the UK. The financial regulator highlighted that the accused failed to conduct proper customer due diligence or verify the source of funds used in the ATM transactions. This oversight allowed individuals involved in money laundering and tax evasion to exploit the machines for illegal activities.

In addition to operating without proper authorization, the operator faces additional charges of document forgery and possession of £19,540 in illicit assets, allegedly earned from the cryptocurrency ATM network. Authorities also discovered that he attempted to deceive them by falsely claiming he had sold the business to a fictitious individual.

Consequences and Potential Sentencing

The FCA emphasized that there are currently no legally registered cryptocurrency ATM operators in the UK, making this case a key precedent for the regulation of the crypto sector. The sentencing of the accused is pending at Southwark Crown Court, where he could face up to 14 years in prison for his offenses.

In Summary

This case marks a significant milestone in the UK’s cryptocurrency regulation efforts, underlining the importance of regulatory diligence and transparency in this rapidly growing market. The FCA has reinforced its commitment to enforcing anti-money laundering laws, and unregulated operators like this one are now facing severe consequences for their actions.