Coinbase’s UK unit, CB Payments Limited (CBPL), was fined $4.5 million by the UK Financial Conduct Authority (FCA) for repeatedly violating a restriction against serving high-risk customers.
Although CBPL itself does not handle crypto transactions, it acts as a “gateway” for trading through other entities within the Coinbase Group.
Notably, CBPL is not registered to conduct crypto activities in the UK.
In October 2020, after extensive discussions with the FCA about CBPL’s financial crime controls, the firm agreed to a voluntary requirement (VREQ) to stop onboarding new high-risk customers until these issues were resolved.
Despite this, the FCA found that CBPL onboarded and provided e-money services to 13,416 high-risk customers. About 31% of these customers deposited approximately $25 million, which was then used for withdrawals and various crypto transactions through other Coinbase entities, totaling around $226 million.
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