The UK Passes Bill That Allows Authorities to Seize Crypto Used in Crimes
- The UK has stepped up its efforts to tackle the use of crypto for crimes in recent months.
- The FCA noted that most crypto-promoting companies are in breach of its new marketing rules.
The United Kingdom (UK) has moved ahead with a bill that allows law enforcement agents such as local police to freeze and seize crypto assets used for crimes such as terrorism, drug trafficking, and cybercrime. The bill, known as the Economic Crime and Corporate Transparency Bill is set to become law once it receives royal assent.
The bill was first introduced last September but was revised to accommodate provisions to enable authorities to seize crypto assets involved in criminal activities. Lawmakers believe the new bill will come in handy during times of emergency as it will enable law enforcement agencies to act with few legal hurdles. The UK has already seized a huge amount of cryptocurrency linked to criminal activities.
The UK is stepping up its efforts to address crypto-related crimes despite its ambitions to support the budding sector. Over the last few months, UK authorities have announced several measures to regulate the use of cryptocurrencies. Part of these efforts includes deploying specialists to tackle crypto crimes.
In May, UK authorities announced plans to ban cold calls promoting financial products like cryptocurrencies and insurance. In addition, the UK’s Financial Conduct Authority (FCA) recently enforced a new rule covering crypto-related ads. The bill, which was first announced in June, seeks to control the unregulated crypto promotion space and protect first-time crypto investors.
The FCA’s policy requires crypto platforms to provide a mandatory “cooling-off period” for new investors. The regulator noted that this period will help reduce impulsive crypto investment decisions, which it blames on misleading promotions.
It also banned the use of “refer a friend” incentives. The FCA claims the bill would ensure crypto investors are not influenced or coerced into investing in the volatile crypto market. The new rules also require crypto firms to register with the FCA to approve their promotions and advertisements.
UK Firms Have Breached the New Marketing Rules
Interestingly, the FCA claims that companies promoting crypto products have breached its marketing laws more than 221 times since it enforced the new regulations on October 8. The FCA noted on Wednesday, October 25, that crypto-promoting companies have continued to make claims about the safety, security, or ease of using cryptocurrency without disclosing the associated risks. The regulator added that these firms have failed to provide noticeable risk warnings on their platforms.
The FCA wrote in a blog post:
We expect authorized firms approving the financial promotions of cryptoasset firms to take their regulatory obligations seriously. Where this is not happening, we will take action and have already placed restrictions on an authorized firm to restrict it from approving cryptoasset financial promotions.
The regulator added that it is working with social media apps, domain name registrars, search engines, app stores, and payment companies to block and halt the flow of money for banned promotions.
The FCA concluded that “even with the new marketing rules, cryptoassets still remain high-risk and largely unregulated. If something goes wrong, it is unlikely people will have access to consumer protections, so they should be prepared to lose all their money.”
Some companies have pulled out of the UK due to its new marketing policy.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
