The Financial Conduct Authority (FCA) has seen Olumide Osunkoya charged for operating multiple crypto ATMs, kiosks that allow users to buy and sell cryptocurrency for cash or a debit card.   Westgate Chambers’ Andy Hall assisted the FCA’s legal team with their preparation for the proceedings.

These are the first charges to be brought under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLRs) as well as being the first time a person has been accused of running a network of crypto ATMs in the UK.  Mr Osunkoya has also been charged with two offences under the Forgery and Counterfeiting Act 1981 and with possessing criminal property under the Proceeds of Crime Act 2002.

Crypto ATMs are different from traditional ATMs because they don’t connect to a bank account.  Instead, they are linked to the user’s digital wallet.  They have been illegal for some time in the UK and the number in operation in the UK has dropped from an estimated 270 in 2020 to a “handful” today, a number that has reduced further since the successful prosecution of Olumide Osunkoya.

In a statement the FCA confirmed Olumide Osunkoya has been charged with running crypto ATMs that processed more than £2.6m across multiple locations – mainly local convenience stores – between 29 December 2021 and 8 September 2023 despite having been turned down for the required FCA authorisation in 2021.  Mr Osunkoya was also accused of creating a false alias to try and evade FCA rules to cloak the fact he was operating without any official permission.

Therese Chambers, joint director of enforcement and market oversight at the FCA told the media the message this prosecution sends out is clear:

“If you’re illegally operating a crypto ATM, we will stop you. If you’re using a crypto ATM, you are handing your money directly to criminals. Criminals can exploit crypto ATMs to launder money globally.”

During the hearing, the court was told that as well as making a profit of between 10% and 60% from each transaction made using the crypto ATMs, it was highly like that those using Mr Osunkoya’s machines were repeatedly committing money laundering or tax evasion offences were using his machines.

Although Olumide Osunkoya has  been charged for operating multiple crypto ATMs, the date for his sentencing at Southwark Crown Court is yet to be confirmed.   It is highly likely there will be significant custodial and financial penalties.  For the charges under Regulations 86 and 92 of the MLRs, the maximum sentences for these offences are 2 years in prison and/or a significant fine.  For the two offences under the Forgery and Counterfeiting Act 1981, the maximum sentence is up to 10 years in prison and/or a fine while the maximum sentence for an offence of possession of criminal property is up to 14 years in prison and/or a fine.

While we await the date for sentencing, Mr Hall will continue his secondment with the FCA, a decision no doubt confirmed by his contribution to achieving this landmark conviction in such a relatively short amount of time.

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