The owner of a cryptocurrency ATM network in the United Kingdom has pleaded guilty to multiple charges related to the illegal operation of his business, including fraud and money laundering. This case marks a significant development in the regulation of crypto businesses in the UK, highlighting the ongoing battle against financial crimes associated with digital currencies.
According to an announcement made on September 30, Olumide Osunkoya operated at least 11 crypto ATMs across the UK without the necessary registration from the Financial Conduct Authority (FCA). His actions have led to the first prosecution under the country’s money laundering, terrorist financing, and transfer of funds regulations.
Between December 2021 and September 2023, Osunkoya’s ATMs, located in local convenience stores, processed over £2.6 million (approximately $3.5 million) in cryptocurrency transactions. Evidence presented in court indicated that many users of the ATMs were likely engaged in money laundering or tax evasion.
A notable claim from the prosecution stated:
“He continued to operate and grow the crypto ATM network in local convenience shops across the UK despite being refused for registration with the FCA in 2021.”
Financial Gains from Illicit Activities
Osunkoya allegedly profited significantly from his operations, charging transaction fees that ranged from 10% to 60%. This profit margin raises questions about the ethics and legality of the practices employed by crypto ATM operators, especially in an environment that has seen increasing regulatory scrutiny.
In addition to fraud and money laundering charges, the FCA has indicated that Osunkoya attempted to evade regulatory oversight by creating a false alias and forging documents to cover up his illegal activities. The authorities brought further charges against him for possessing £19,540 (approximately $26,000) in cash, suspected to be proceeds from his crypto ATM operations.
Potential Sentencing and Co-defendant Charges
If Osunkoya is sentenced to the maximum penalties for all charges, he could face a total of up to 26 years in prison. The sentencing date has yet to be determined, leaving open the possibility of a lengthy legal battle ahead. Notably, charges against a second individual, Sally Lavington Osunkoya, were dropped following Olumide Osunkoya’s guilty plea.
The Financial Conduct Authority has served as the UK’s supervisor for anti-money laundering and counter-terrorist financing regulations for crypto asset businesses since January 2020. Despite the increasing popularity of digital assets within the country, the FCA ordered the closure of all unregistered crypto ATMs in March 2022. As it stands, there are no legally registered crypto ATM operators currently active in the UK.
The regulatory landscape surrounding crypto ATMs has been challenging, as many operators have attempted to navigate or circumvent legal requirements. The FCA’s strict stance reflects its commitment to combating financial crimes linked to cryptocurrency, particularly amid rising concerns over fraud and illicit activities.
Warnings to Crypto Users
In light of the growing risks associated with unregulated crypto ATMs, Therese Chambers, joint executive director at the FCA, issued a stark warning to crypto users in the UK:
“If you’re using a crypto ATM, you are handing your money directly to criminals. Criminals can exploit crypto ATMs to launder money globally.”
This statement serves as a cautionary note for consumers who may be considering using these machines, emphasizing the potential dangers of engaging with unregulated crypto services.
| Aspect | Details |
|---|---|
| Defendant | Olumide Osunkoya |
| Charges | Fraud, money laundering |
| Crypto ATMs Operated | At least 11 |
| Total Transactions | Over £2.6 million (~$3.5 million) processed |
| Cash Possession | £19,540 (~$26,000), suspected illicit proceeds |
| Potential Jail Time | Up to 26 years |
| Regulatory Oversight | FCA – no registered crypto ATMs since March 2022 |
The guilty plea of Olumide Osunkoya underscores the pressing need for stringent regulatory oversight in the rapidly evolving world of cryptocurrencies. As the FCA continues to clamp down on unregistered crypto ATMs, the implications of this case will likely resonate throughout the digital asset community. The ongoing enforcement actions and regulatory developments reflect a broader effort to maintain the integrity of the financial system and protect consumers from illicit activities.
Featured image credit: Freepik
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