The Financial Conduct Authority (FCA) has issued a warning regarding Liman Capital, a firm allegedly offering financial and crypto-related services without proper authorization. The FCA said that Liman Capital is not authorized or registered with the regulatory body and may be targeting individuals in the United Kingdom. Engaging with such firms could mean that consumers do not have access to the Financial Ombudsman Service for complaints and are not protected by the Financial Services Compensation Scheme (FSCS), making fund recovery unlikely if the firm goes out of business. The FCA advises using its Firm Checker tool to verify the authorization status of financial firms.
According to UK regulations, cryptoasset businesses must register with the FCA under the Money Laundering Regulations if they intend to offer services within those rules. This requirement applies even to firms already authorized for other financial services. Registration involves submitting an application through the FCA's Connect system, paying applicable fees, and providing detailed information about the business, its activities, and key individuals. All officers, managers, and beneficial owners must pass a "fit and proper" assessment. The FCA evaluates past convictions, regulatory compliance, and business conduct during this process. Misleading or incomplete applications may be rejected.
In a press release by the FCA, CB Payments Limited (CBPL), part of the Coinbase Group, was fined £3.5 million for allowing 13,416 high-risk customers to access crypto trading through other Coinbase entities despite restrictions. This resulted in $226 million in transactions. The FCA attributed this issue to inadequate controls that increased money laundering risks. This enforcement action marks the first under the Electronic Money Regulations 2011.
Learn Signal reports that the Financial Conduct Authority was established on April 1, 2013, succeeding the Financial Services Authority as part of a comprehensive reform of the UK's financial regulatory framework following the global financial crisis. Operating independently from the UK government, it is funded by fees charged to the financial services industry. Its primary objectives include protecting consumers, ensuring market integrity in UK finance, and promoting effective competition in consumer interests.
