Regulator Says FTX 'Targeting' Crypto Consumers In UK Without Authorization: 'Unlikely To Get Your Money Back If Things Go Wrong'

Zinger Key Points
  • The financial regulator warned people of not getting their money back since FTX was not authorized to operate in the U.K.
  • Kraken and got the go-ahead from the watchdog after they complied with the FCA’s rules.

Sam Bankman-Fried's cryptocurrency exchange FTX is operating in the United Kingdom without authorization, the Financial Conduct Authority (FCA) on Monday stated, as it warned that investors will not get their money back “if things go wrong.”

“Almost all firms and individuals offering, promoting, or selling financial services or products in the UK have to be authorized or registered by us,” the financial regulator stated.

FTX targeting people in the UK

It added that the crypto exchange, without having authorization, was “targeting” people in the U.K.

“You will not have access to the Financial Ombudsman Service or be protected by the Financial Services Compensation Scheme (FSCS), so you are unlikely to get your money back if things go wrong,” the FCA stated.

FTX offers a variety of the top digital assets, including Bitcoin BTC/USD and Ethereum ETH/USD.

All crypto firms needed to comply with anti-money laundering norms

In April this year, the FCA mandated that all crypto businesses that offer services in the U.K. are obliged to comply with its specific anti-money laundering criteria.

Well-known exchanges like Kraken and got the go-ahead from the watchdog after they complied with the FCA’s rules.

The FCA said last year that Binance Markets Limited, a subsidiary of Binance with offices in the U.K., was not authorized to engage in any regulated activity there.

The entity was thus told to stop offering derivative items.

Binance expanded its staff and implemented stringent Know-Your-Customer (KYC) guidelines throughout the course of the following few months in order to get regulatory permissions.

37 companies on provisional registration status

Since August 2020, the FCA has been compiling a list of companies dealing in digital assets that have registered and complied with the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations of 2017.

The 37 companies on that list as of right now include, among others, the cryptocurrency exchanges Gemini, Kraken, Galaxy Digital, and eToro, alongside challenger bank Revolut on provisional registration status.

Are you ready for the next crypto bull run? Be prepared before it happens! Hear from industry thought leaders like Kevin O’Leary and Anthony Scaramucci at the 2022 Benzinga Crypto Conference on Dec. 7 in New York City.

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Posted In: CryptocurrencyMarketsFTXSam Bankman-Fried
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