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The Financial Conduct Authority (FCA) has issued a warning regarding Coinvestbase, a firm suspected of offering or promoting financial services in the United Kingdom without proper authorization. Coinvestbase is not registered with the FCA and may be targeting UK residents. The company lists an address in Guildford and operates through the website coinvestbase.net. Due to its lack of FCA approval, customers engaging with the firm are not protected by the Financial Ombudsman Service or the Financial Services Compensation Scheme. The FCA advises using its Firm Checker to verify authorization status.
According to the FCA, UK cryptoasset businesses must register under the Money Laundering Regulations if they intend to offer services that fall 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 considers past convictions, regulatory compliance, and business conduct during evaluation. 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 marks the first enforcement action under the Electronic Money Regulations 2011.
