The Financial Conduct Authority (FCA) has issued a warning regarding Zenex, a company offering financial and crypto-related services without proper authorization.
According to the FCA, Zenex operates through the website zenextrades.com and is based in Lurgan, Armagh. The firm is not authorized to provide financial services in the UK and may be contacting UK consumers using potentially misleading contact information, such as the email support@zenextrades.com. As Zenex lacks FCA authorization, customers are not protected by the Financial Ombudsman Service or the Financial Services Compensation Scheme, which means they may not recover funds if issues arise.
UK cryptoasset businesses must register with the FCA under the Money Laundering Regulations if they intend to offer services falling 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 related development reported by a press release from 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 cited inadequate controls as contributing to 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. It succeeded the Financial Services Authority as part of a comprehensive reform of the UK's financial regulatory framework following the global financial crisis. Operating independently of the UK government, it is funded by fees charged to the financial services industry. Its primary objectives include protecting consumers, ensuring market integrity in the UK’s financial markets, and promoting effective competition in consumers' interests.
