Bitcoin has made up the lion's share of digital currencies seized by British police forces over the past five years, according to Freedom of Information requests.
Britain seizes illegal amounts of bitcoin
UK police forces have seized 322 million pounds ($435 million) worth of bitcoin and other digital currencies as a result of criminal investigations over the past five years.
According to Freedom of Information (FOI) requests made by New Scientist, 12 of Britain's 48 police forces seized cryptocurrencies worth £322 million at the time of the seizure. In comparison, 15 forces failed to respond or failed to provide information.
The vast majority - over 99.9% - of the cryptocurrencies seized were Bitcoin, with the remainder made up of Ethereum as well as privacy coins including Monero, Dash and Zcash.
Greater London Police accounted for the lion's share of the confiscation, amounting to 294 million pounds ($398 million). Freedom of information requests revealed that Greater Manchester Police seized 25 million pounds ($34 million) while Dyfed-Powys seized 2.4 million pounds ($3.2 million) over the five-year period covered by the requests.
Chief Inspector Joseph Harrop of Greater Manchester Police's Economic Crimes Unit told New Scientist that British police forces are "just working to understand" crypto technology. His own force recruited civilian personnel with relevant experience to train investigators.
Troops face an additional legal hurdle when seizing digital currency given that it is currently classified as property rather than cash under the Proceeds of Crime Act.
While cash can be confiscated if it is suspected that it constitutes the proceeds of criminal activity, forces require a conviction for the confiscation of non-cash property—although the law has been updated to fill this loophole.
Until then, Gary Cathcart, the head of financial investigations at the National Crime Agency, told New Scientist, “We're kind of in the same situation with the cryptocurrencies we had 20 years ago. We don't have the legislation to seize it. ”
Cryptocurrency and crime
UK regulators and lawmakers are increasingly concerned about the criminal use of cryptocurrencies.
In May 2021, the NCA released a report stating that “the use of digital assets for money laundering has increased across many types of crime.” As part of the crackdown on the criminal use of cryptocurrencies, the Financial Conduct Authority has invested £500,000 ($670,000) in external consultants to train staff on the money laundering and terrorist financing risks presented by the cryptocurrency industry.
In 2021 alone, the Metropolitan Police confiscated two record numbers of cryptocurrency; In June 2021, it seized £114 million (then worth $158 million), while the £180 million (approximately $250 million) forfeiture occurred just weeks later.
In November, a British director of the Silk Road darknet market lost nearly half a million pounds to the UK's NCA.
Regulators have responded with stricter requirements on crypto companies; In March 2021, the UK's Financial Conduct Authority (FCA) announced that crypto companies must file annual financial crime reports.
Banks have also imposed restrictions on the use of cryptocurrency due to money laundering concerns, with Santander, NatWest and Barclays either banning cryptocurrency exchanges, restricting transactions or increasing scrutiny of transfers to and from crypto firms.
