UK regulators warn crypto firms aren’t exempt from Russian sanctions rules

The Bank of England, HM Treasury and the Financial Conduct Authority issued a joint statement on sanctions and crypto assets amid Russia’s invasion of Ukraine. 

The statement is the first of its kind from UK’s financial regulators, and joins the growing body of public issuances on the topic since the invasion began last month. The statement — a reiteration of commitments to monitor for potential crypto use by sanctioned bodies as well as a reminder on the commitments of regulated firms — is unsurprising, given the stated posture of Western governments in recent weeks, including in the US. 

“The UK financial regulatory authorities reiterate that all UK financial services firms, including the cryptoasset sector, are expected to play their part in ensuring that sanctions are complied with,” the statement reads. “We are working closely with partners in government and law enforcement both here and abroad, including regulatory authorities, to share intelligence and act to prevent sanctions evasion, including through cryptoassets. We also remain ready to act in the event of sanctions breaches.”

In its statement, the BoE and the FCA said that “financial sanctions regulations do not differentiate between cryptoassets and other forms of assets.”

“The use of cryptoassets to circumvent economic sanctions is a criminal offence under the Money Laundering Regulations 2017 and regulations made under the Sanctions and Anti-Money Laundering Act 2018,” they continued. 

The UK was among a number of governments to issue sanctions against Russian banks and wealthy citizens of that country in the aftermath of the invasion, which continues to escalate.