UK authorities have arrested three men in connection with a large-scale crypto fraud that allegedly laundered more than $20 million through shell companies. The arrests are part of Operation Galafarm, an ongoing investigation led by the Metropolitan Police’s Economic Crime Command into rising digital asset-related scams.
Officials say the suspects ran fraudulent investment schemes, promising high returns from crypto opportunities while rerouting victims’ funds through a network of shell entities to obscure their origins.
“It is alleged more than £15 million ($20 million) in stolen funds was laundered through a set of shell companies,” a police spokesperson told reporters.
On May 7, officers executed search warrants at six locations across London. Two men, aged 24 and 36, were arrested in Hackney, while a third suspect—also 36—turned himself in later that day. All three have since been released on bail pending further investigation.
UK Tightens Crypto Crime Crackdown as Asset Seizures Climb
The arrests come amid the UK’s intensified crackdown on crypto-enabled financial crime. Authorities have expanded powers to seize, freeze, and even destroy digital assets linked to criminal activity, as concerns grow over the country’s role in facilitating global crypto fraud.
Estimates from the National Crime Agency (NCA) suggest the UK is linked to over $5.1 billion in illicit crypto transactions annually. In response, law enforcement agencies have stepped up enforcement, including high-profile seizures of digital assets.
Data from Arkham Intelligence indicates that the UK government now holds more than 61,000 BTC, currently valued at over $6.1 billion, making it one of the largest national holders of seized cryptocurrency.
UK Rules Out Bitcoin Reserve Strategy, Citing Market Risks
While several countries—including the U.S.—have recently explored Bitcoin reserve strategies, the UK government has taken a different stance. Speaking at the Financial Times Digital Asset Summit, Economic Secretary to the Treasury Emma Reynolds MP dismissed the idea of holding Bitcoin as part of national reserves.
“We don’t think that’s appropriate for our market. We understand that’s what the U.S. is going for, but that’s not the plan for us,” Reynolds said.
Her comments come as critics question the government’s decision to hold, rather than liquidate, its seized Bitcoin stash—particularly as Britain implements austerity measures like winter fuel subsidy cuts for pensioners. While the Treasury has no immediate plans to sell the crypto, rising public scrutiny could force a rethink, especially if Bitcoin continues climbing to new highs.
Quick Facts
- Three men were arrested in London for running a crypto scam that laundered over $20 million through shell companies.
- UK police are expanding powers to seize and manage crypto assets linked to criminal activity.
- The UK government currently holds over 61,000 BTC—valued at $6.1 billion—mostly from criminal seizures.
- Officials have rejected proposals for a national Bitcoin reserve, calling it unsuitable for the UK market.
