UK Crypto ATM Operator Faces 26 Years for Fraud and Money Laundering Involving Bitcoin Transactions

• The owner of a UK-based crypto ATM network faces prosecution on multiple criminal charges.
• The charges include fraud and money laundering due to operating without FCA registration.
• Olumide Osunkoya could face up to 26 years in prison if convicted of all charges.

Olumide Osunkoya’s Crypto ATM Network: A Deep Dive into Fraud and Money Laundering Charges

First Prosecution under UK’s Crypto Asset Regulations

In a landmark case, Olumide Osunkoya has pleaded guilty to operating a network of crypto ATMs in the UK without the necessary registration from the Financial Conduct Authority (FCA). This marks the first prosecution in the country under the money laundering, terrorist financing, and transfer of funds regulations. Osunkoya managed at least 11 ATMs, which processed transactions totaling over £2.6 million (~$3.5 million) between December 2021 and September 2023.

Unregulated Operations and Illegal Profits

Despite being denied registration by the FCA in 2021, Osunkoya continued to expand his network of crypto ATMs across local convenience stores in the UK. The prosecution revealed that transaction fees ranged from 10% to 60%, netting substantial profits. Evidence indicated that many ATM users were likely involved in illicit activities such as money laundering and tax evasion. The FCA stated that Osunkoya went to great lengths to evade regulations, including creating a false alias and forging documents.

The Financial and Legal Implications

Operating without FCA registration exposed numerous users to significant risks. Olumide Osunkoya was found in possession of £19,540 (~$26,000) in cash, suspected to be proceeds from his unlawful activities. If convicted on all charges, including fraud and money laundering, Osunkoya faces a maximum sentence of 26 years in prison.

Impact on the UK Crypto Market

Since January 2020, the FCA has acted as the UK’s Anti-Money Laundering and Counter-Terrorist Financing supervisor for crypto businesses. Despite the increasing popularity of digital assets, the regulatory body ordered the shutdown of all unregistered crypto ATMs in March 2022. Currently, the UK has no legally registered crypto ATM operators. FCA joint executive director Therese Chambers warned that using unregistered crypto ATMs equates to handing money directly to criminals, making it a tool for global money laundering.

Conclusion

The case against Olumide Osunkoya serves as a potent reminder of the importance of regulatory compliance in the evolving landscape of digital assets. As the first of its kind under UK law, this prosecution highlights the rigorous stance regulators are taking to combat financial crimes involving cryptocurrencies. Going forward, industry participants must adhere to FCA guidelines to avoid legal ramifications and ensure the credibility of the crypto market in the UK.