Police forces in the UK have seized £322 million ($435 million) worth ofand other cryptocurrencies as a result of criminal investigations over the past five years.
According to Freedom of Information (FOI) requests made by New Scientist, 12 of the UK’s 48 police forces have seized crypto amounting to £322 million at the time of seizure. In comparison, 15 forces either failed to respond or declined to provide information.
The London Metropolitan Police made up the lion’s share of the seizures, with takings of £294 million ($398 million). FOI requests revealed that Greater Manchester Police seized £25 million ($34 million) while Dyfed-Powys police seized £2.4 million ($3.2 million) over the five-year period covered by the requests.
Detective chief inspector Joseph Harrop of Greater Manchester Police’s economic crime unit told New Scientist that UK police forces are “just getting their heads around” the technology of cryptocurrency; his own force has been recruiting civilian staff with relevant experience to train detectives.
Forces face an additional legal hurdle when seizing cryptocurrency since it’s currently classified as property, not cash, under the Proceeds of Crime Act.
While cash can be seized if there’s a suspicion it forms the proceeds of criminal activity, forces require a conviction to seize non-cash property—though the act is being updated to close this loophole.
Until then, Gary Cathcart, the National Crime Agency’s head of financial investigations, told New Scientist, “we’re kind of in the same situation with crypto that we were with cash 20 years ago. We haven’t got the legislation to seize it.”
Crypto and crime
The UK’s regulators and lawmakers have grown increasingly concerned about the criminal use of cryptocurrency.
In May 2021, the NCA released a report stating that ” the use of crypto assets to launder money has increased across several crime types.” As part of the drive to crack down on criminal use of cryptocurrency, the FCA has invested £500,000 ($670,000) on external consultants to train staff on the money laundering and terrorist financing risks presented by the crypto industry.
In 2021 alone, the Metropolitan Police made two record-breaking seizures of cryptocurrency; in June 2021, it confiscated £114 million (then worth $158 million), while a seizure of £180 million (almost $250 million) took place just weeks later.
In November, a British administrator of the Silk Road darknet marketplace forfeited almost half a million pounds to the UK’s NCA.
Regulators have responded with tougher requirements on crypto firms; in March 2021, the UK’s Financial Conduct Authority (FCA) announced that cryptocurrency businesses must file annual financial crime reports.
Banks have also clamped down on crypto use due to concerns around money laundering, with Santander, NatWest, and Barclays either blocking crypto exchanges, capping transactions, or increasing scrutiny of transfers to and from crypto businesses.
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