The UK’s struggling Financial Conduct Authority (FCA) is prepared to splash a half million pounds on cryptocurrency consultants as it attempts to meet its regulatory obligations under UK anti-money laundering (AML) legislation.
The FCA has been responsible for the UK’s AML legislation since January 2020, but still finds itself unable to get a grip on the cryptocurrency sector.
An advert on the UK public sector tendering website, Bidstats, reveals that the authority requires technical assistance and training, having neither the tools nor the talent to currently conduct the job.
“The FCA is seeking the services of a third-party firm…. who can provide access to a platform that can support the robust and efficient analysis of cryptoasset blockchain data and provide training and ongoing support in the use of this platform,” said an FCA advert posted earlier this month.
The final deadline for applicants is December 16, 2021, making it highly unlikely that any appointment will be in place before 2022.
Challenging times for the FCA
The FCA is attempting to upskill staff during a period of extreme friction between chief executive Nikhil Rathi and the general workforce. In a consultation exercise launched this September, staff learned that the organization intends to end its current bonus structure. The organization further plans to slash employee earnings over the course of the next four years, which has led to a slew of resignations and plummeting staff morale.
The cuts come against a background of increased workloads in part thanks to Brexit, the pandemic, and a rapidly evolving global financial landscape hastened by increasing cryptocurrency adoption.
Earlier this month the FCA was rocked by controversy as the Guardian revealed that the body is currently under investigation by the Financial Regulators Complaints’ Commissioner. In an extraordinary breach of trust, it is alleged that the FCA unlawfully changed its own complaints procedure to avoid paying out compensation for deep failings within the organization.
The authority has also struggled to make significant progress with its own flagship crypto registration scheme, which mandates that all crypto businesses register with the FCA to do business in the UK. The FCA originally intended to ban any business not registered by January of 2021, but making heavy weather of the situation the authority then extended the deadline to July of 2021, and then March 2022.
So far the authority has registered 5 crypto businesses, with 90 still on the waiting list. A further 50 have pulled out of the slow-moving process including industry heavyweights Binance.
In June the FCA responded to the withdrawal by issuing a warning against Binance. The warning stated that neither BINANCE Markets, nor any other entity in the Binance Group “holds any form of UK authorisation, registration or licence to conduct regulated activity in the UK.”
CZ wholeheartedly praises regulators
Binance CEO Changpeng Zhao has recently been on a charm offensive to woo regulators. In an interview on Blomberg TV last week, the c-level executive was quick to commend regulators from around the world including in the US and Singapore.
The UK was, however, one of the regions the Binance chief forgot to single out for praise.
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