UK FCA crypto skills gap is causing slow enforcement, says National Audit Office
The National Audit Office (NAO) in the United Kingdom has raised concerns about the effectiveness of the Financial Conduct Authority (FCA) in regulating the cryptocurrency industry.
In a recent report titled ‘Financial Services Regulation: Adapting to Change', the NAO said the FCA is responding and cracking down on illegal activities in the crypto industry.
High rates of staff turnover and a lack of specialist skills increase the risk to @TheFCA's key commitments.
It responded by recruiting £317m for its transformation programme.
This should help prepare financial services for the future.
More: pic.twitter.com/GtG5TAjl4t
— National Audit Office (@NAOorguk) December 8, 2023
The NAO said it took the FCA almost three years to crack down on illegal operators of crypto ATMs. On July 11, Cointelegraph reported that the FCA had shut down 26 crypto ATMs as part of a coordinated investigation. Meanwhile, the NAO said:
“Although the FCA required crypto-asset companies to comply with anti-money laundering regulations from January 2020 and began monitoring, including engaging with unregistered firms, it did not begin taking enforcement action against operators of illegal crypto ATMs until February 2023.
The NAO asserted that the delay in registering crypto firms seeking regulatory approval from the FCA was due to the lack of dedicated crypto staff.
“For example, a lack of crypto skills has caused the FCA to take longer than planned to register crypto-asset firms under money laundering regulations,” the report said.
On Jan.27, Cointelegraph reported that the FCA approved only 41 of the 300 crypto firm applications seeking regulatory approval, as the rules took effect in January 2020.
Related: UK picks up crypto activity in Central, Northern and Western Europe: chain analysis
This comes after the FCA recently released guidance to help you better understand the new crypto promotion rules that came into force recently.
In the year On November 2nd, Cointelegraph reported that the FCA had released a “complete handbook” for compliance with the new rules.
The new rules specifically relate to how crypto companies are allowed to advertise to customers.
The FCA listed issues such as crypto firms making claims of ease of use of crypto without disclosing the risks involved and risk warnings not appearing sufficiently in small fonts.
Magazine: Crypto Regulation: Does SEC Chairman Gary Gensler Have Final Comments?
