The UK Financial Conduct Authority has proposed treating enhanced due diligence for crypto transfers involving personal or unhosted wallets as good practice in nonbinding guidance. The consultation, opened on October 23, seeks feedback on updates to the FCA’s Financial Crime Guide and does not introduce any new requirements. The draft criticizes the use of third-party risk scores that firms cannot explain and rigid tracing rules that do not account for actual risk. Firms remain responsible for their financial-crime controls when using third-party suppliers, and the FCA does not expect a material increase in compliance costs. Responses are due by December 24, 2026, before the authority plans to publish feedback and the final Guide text.
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