UK Treasury official: A 'significant number' of crypto firms fall short of AML standards

Quick Take

  • Economic secretary to the Treasury John Glen has responded to questions over the state of the FCA’s crypto register.
  • He said a significant number of crypto firms have failed to employ the right people to implement AML processes.

John Glen, economic secretary to the Treasury and City minister, has issued a statement claiming that a large number of crypto startups have failed to meet anti-money laundering (AML) standards set by regulators in the United Kingdom.

“A significant number of firms have failed to implement appropriately robust AML control frameworks, and to employ fit and proper personnel,” said Glen in a written reply to Philip Davies, Conservative member of Parliament (MP) for Shipley, West Yorkshire.

Davies put a series of written questions to chancellor Rishi Sunak earlier this week over continued delays to the Financial Conduct Authority (FCA)’s crypto register.

Glen’s statement comes as hundreds of crypto startups are in limbo over whether they will be able to continue to operate beyond July 9, the revised deadline by which they must either be included in the FCA’s cryptoasset register or cease trading.

Glen said that five crypto firms had been registered as of May 24. Those companies are Ziglu, Archax, Digivault and two Gemini entities.

“Of the firms assessed to date over 90% have withdrawn their application following FCA intervention,” he added. According to Glen, there are currently 167 U.K. crypto firms awaiting registration. There are also 77 new crypto startups which have applications that are pending a full assessment.

The questions put to Sunak by Davies earlier this week focused on whether the logjam around the crypto register might harm the U.K.’s reputation as a hub for financial innovation — a fear that has been echoed by both lobby groups and Davies’s fellow MPs.

“The U.K. is committed to having a robust AML regime for cryptoassets which will help to bolster confidence in the U.K. as a safe and reputable place to start and grow a cryptoasset business,” said Glen.

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