In a significant legal development, Olumide Osunkoya has pleaded guilty in a landmark case concerning the illegal operation of crypto ATMs.
- Osunkoya operated at least 11 unregistered crypto ATMs, processing over £2.6 million in transactions.
- The FCA had refused Osunkoya’s registration in 2021, but he continued his operations unlawfully.
- No customer due diligence checks were conducted, raising concerns about potential money laundering or tax evasion.
- The FCA has been actively shutting down illegal crypto ATMs across the UK, with multiple raids conducted.
In a first-of-its-kind case in the United Kingdom, Olumide Osunkoya’s guilty plea marks a significant stride in addressing illegal crypto ATM operations. His unlawful activities came under legal scrutiny after it was found that he managed a network of at least 11 ATMs, which facilitated cryptocurrency transactions exceeding £2.6 million between December 2021 and September 2023.
Despite the Financial Conduct Authority’s refusal to grant registration in 2021, Osunkoya continued with his operations. These machines, placed in various convenience stores around Britain, were functioning without the necessary legal endorsement. British legislation mandates that any enterprise dealing in cryptoasset transactions must secure approval from the FCA. Currently, no crypto ATMs have such approval from the regulator.
The court proceedings brought to light Osunkoya’s lack of customer due diligence, an essential process in verifying the identity of clients and ensuring legal compliance. This omission has led to allegations that such ATMs might have been exploited for illicit activities like money laundering or tax evasion. It was reported that Osunkoya potentially gained substantial profits from these operations while attempting to bypass FCA regulations through the use of a false identity.
As sentencing awaits at Southwark Crown Court, the date for which is yet to be announced, this case underscores the FCA’s intensified efforts to curb illegal crypto ATM operations. Collaborative actions with local police have resulted in shutdowns of over two dozen sites across various UK cities including London, Leeds, Exeter, Sheffield, and Nottingham.
The FCA’s joint executive director of enforcement and market oversight, Steve Smart, cautioned, “If you use a crypto ATM in the UK, you are using a machine that is operating illegally and you may be handing your money over to criminals.” Such statements highlight the risks associated with unregistered crypto ATMs and the regulatory body’s commitment to protecting consumers.
Osunkoya’s conviction reinforces the UK’s stringent regulatory stance on unregistered crypto ATMs, emphasising consumer protection.
