FCA Opens Money Laundering Investigation Into Euro Exchange Securities UK
A London payments firm was already shut down and placed into special administration in June. Now the FCA has confirmed a formal investigation into whether it broke anti-money-laundering law over a six-year period.
Priya Ramanathan
Business Features Writer
The Financial Conduct Authority confirmed this week that it has opened a formal investigation into Euro Exchange Securities UK Ltd, examining potential offences under UK anti-money-laundering law covering a period stretching back more than six years. The firm — the London arm of an electronic money and payments business with additional operations in the United States and Spain — was already forced out of business by regulators back in June, well before this formal investigation was confirmed.
The investigation covers the period from 1 February 2020 to 4 June 2026, and centres on suspected offences under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. The FCA has said EES may have failed to properly identify and assess money-laundering risk connected to its customers, the countries it operated in, and the way it delivered its services — and may separately have failed to maintain adequate policies and controls to manage those risks once identified.
It's worth being precise about what the FCA has and hasn't said at this stage. The regulator has stated explicitly that it has not reached any conclusions as to what actually happened, or whether EES breached any requirement at all. Opening a formal investigation is a procedural step reflecting sufficient concern to warrant a full inquiry — it is not itself a finding of wrongdoing, and no specific transaction volumes, account-level findings, or compliance failures have been made public as part of this announcement.
The regulatory action against EES actually began well before this week's investigation announcement. The FCA first started monitoring the firm back in 2020, citing concerns over weaknesses in its financial crime controls. Those concerns escalated sharply this summer: on 4 June 2026, the FCA required EES to stop providing electronic money and payment services entirely, and successfully applied to the courts for interim managers to be appointed, citing serious concerns that the way the firm operated indicated significant risk of financial crime. A First Supervisory Notice followed on 2 August, formally confirming EES could not resume regulated activity and imposing an assets requirement, including a specific obligation to keep customer funds properly ring-fenced in a designated safeguarding account.
On 11 June, the High Court confirmed the appointment of Duncan Perring and James Bennett of Teneo Financial Advisory Limited as joint special administrators, acting under the Payment and Electronic Money Institution Insolvency Regulations 2021 — a legal framework specifically designed to protect customer funds when an electronic money or payment institution becomes insolvent, distinct from ordinary company insolvency procedures. The FCA separately sought recognition of the UK proceedings in a US federal court, reflecting the firm's cross-border operations and customer base.
Matthew Long, the FCA's director for payments and digital assets, said the risk of payment firms being used by criminals to launder money in order to fund other offences is a significant one, and that the regulator continues to work with partner agencies, including the Security Industry Authority, as part of a wider strategy to disrupt financial crime moving through the UK payments sector.
The case sits inside a broader pattern the FCA has flagged across the electronic money sector over recent years. Having approved a large number of e-money institutions to operate in the UK over the past decade, the regulator concluded by 2023 that a meaningful number lacked adequate financial crime controls relative to the risks their business models actually carried, prompting tighter supervisory expectations and new audit requirements introduced in 2025. It's worth noting that customers of e-money and payment firms don't benefit from the Financial Services Compensation Scheme in the way bank depositors do — safeguarding rules requiring customer funds to be held separately from a firm's own money are the primary protection in this sector, which is exactly the area the special administrators are now working to reconcile at EES.
For UK payment institutions and electronic money firms more broadly, the practical signal from this case is less about any specific compliance failure — since none has been confirmed — and more about the FCA's evident willingness to act decisively, first through an immediate cessation order and special administration, and only some months later through a formal investigation into the underlying conduct. Firms in the sector should expect that sequence, rather than a single enforcement announcement, to be the more typical pattern going forward: rapid protective action to secure customer funds first, with a fuller regulatory and legal reckoning over specific findings following in a separate, later process.