The Financial Conduct Authority (FCA) has issued a warning regarding CapitalxTrades, a firm based in Washington, DC. The company operates the website www.capitalxtrades.net and is providing financial services in the United Kingdom without FCA authorization. The regulatory body cautions that engaging with unauthorized firms could lead to a lack of access to the Financial Ombudsman Service and the Financial Services Compensation Scheme.
According to the FCA, UK cryptoasset businesses must register 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 cited inadequate controls as the cause of these failures, which increased money laundering risks. This action marks the first enforcement under the Electronic Money Regulations 2011.
Learn Signal reports that the Financial Conduct Authority (FCA) was established on April 1, 2013. It succeeded the Financial Services Authority (FSA) as part of comprehensive reforms to 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 UK finance markets, and promoting effective competition for consumer benefit.
