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"Five Eyes" Embassy personnel are prohibited from using Revolut due to suspected ties with Russia

It has been reported that key embassy personnel within the 'Five Eyes' western intelligence alliance are forbidden from using Revolut due to alleged Russia ties.

Australia, the United States, the United Kingdom, Canada, and New Zealand are members of the Five Eyes intelligence-sharing agreement.

The British publication Observer revealed that alliance embassy personnel "are discouraged from using Revolut."

The newspaper, stated that this was due to the fact that Revolut founder Nikolay Storonsky's father has ties to Russia.

Revolut emphasized, however, that Storonsky Senior, who is of Ukrainian heritage, was "entirely unconnected with Revolut."

"Storonsky himself has long denied any affiliation to the Kremlin and claimed concerns over his father’s job were ‘a bit funny,’ given he was ‘effectively a professor’ and engineer in a company that employs half a million people in Russia," according to the newspaper.

"Western intelligence officials struggle to see the joke, apparently," according to the Observer.

Storonsky revealed in October that he had renounced his Russian passport, weeks after his father was subjected to sanctions that have never been repeated in any other country.

Revolut reported that the chief executive renounced his citizenship shortly after the invasion of Ukraine.

The corporation informed the Observer that Storonsky had resided in the United Kingdom for twenty years and had taken a "clear stance condemning the Russian invasion" by calling the conflict as "wrong and totally abhorrent" in an open letter. In addition to assisting impacted Ukrainians, Revolut closed its Russian office, the statement continued.

More than two years have elapsed since Revolut's initial application for a license with the UK's financial authority, and the company is still awaiting approval. The fintech must yet persuade regulators, primarily the Financial Conduct Authority (FCA), that it deserves to keep deposits and commence lending to consumers.

Observer: "Some believe the watchdog's caution is wise," citing delayed submission of accounts, EU regulatory violations and fines, Storonsky's alleged Russian contacts, and a work environment that resulted in the resignation of several important staff.

Storonsky, a former derivatives trader at Credit Suisse and Lehman Brothers, co-founded Revolut in London in 2015.

It has expanded from a prepaid card giving free currency exchange to a financial institution with over 6,000 employees, 27 million users in 37 countries, and over 50 products and services. In addition to money transfers, it offers property rentals, buy-now-pay-later credit, and an advance wage payment service.


Revolut's culture problems have been widely noted, and the firm has partially acknowledged and attempted to address them. In a 2019 open letter, Storonsky stated that it had addressed "mistakes," and in January, the company informed the Guardian that it was beginning a "cultural shift" and a dedicated behavioural team that would monitor whether employees were "approachable" and "respectful."

In 2019, it was revealed that the FCA has investigated Revolut after a whistleblower claimed in 2016 that the company was failing to complete necessary AML checks and flag suspicious payments.

At the time, a former employee told the BBC that "the chief executive refused to listen to the compliance team," resulting in the departure of key personnel, including the chief risk officer and money-laundering reporting officer.

"The FCA informed the whistleblower that it had closed the investigation in 2017. And although Revolut told the BBC at the time that it had been unaware of the regulatory investigation, the resulting media coverage prompted Storonsky to write his open letter ," the Observer reported.

Many compliance personnel at British high street banks, who verify businesses adhere to regulations like sanctions and anti-money laundering, told the Observer that some industry peers were still concerned about the company.

Numerous sources told the paper that compliance workers at Revolut had a high turnover rate. One individual opined that working at the fintech company posed a "reputational risk too far for most well-regarded staff who work within compliance."

"This staff churn is one reason why Revolut has spent twice as long as some smaller rivals trying to win a UK banking licence, according to insiders at the FCA and within financial law enforcement," it was reported.

Revolut denied having a negative workplace culture or a problem with key positions being vacated.

It stated that it received thousands of applications for risk and compliance positions and that the team grew from 147 to 220 employees between 2021 and 2023. It did not address queries regarding compliance personnel turnover. It stated, "We have a high-performance culture, which we are incredibly proud of, as it has got us to where we are today."

The company stated that it complied to all AML/CFT financing regulations.

"Risk and compliance is and always will be a top priority for Revolut," the company stated, while its lawyers emphasized the company's "sophisticated suite of financial crime detection systems, including customer due diligence and transaction monitoring." It said that rivals Starling Bank and Monzo were considerably smaller when they sought their banking licenses.

Storonsky immigrated to the United Kingdom in 2004 at the age of 20 and ultimately obtained British citizenship.

According to the Observer, the young banker, who was born in Dolgoprudny, just north of Moscow, and earned a degree in physics in the capital, has family ties that western intelligence officers and UK law enforcement agencies "find challenging."

His father, also named Nikolay Storonsky, is a high-ranking official in Russia's state-owned gas giant Gazprom. After Russia's invasion of Crimea in 2014, the United States imposed sanctions on Gazprom.

After Revolut obtained its EU banking license through Lithuania in 2018, MPs in the ex-Soviet republic started two parliamentary probes on national security concerns regarding the Storonsky Sr's state ties and whether or not they made the company "politically vulnerable."

In the end, they determined that there was no proof that Revolut posed a threat to national security. In April 2019, the Lithuanian parliament failed to garner support for a third investigation into Revolut's operations despite continuing to express worry over the company's practices.

Later, in October of last year, Kyiv imposed sanctions on his father, claiming he was "responsible for the material and financial support of actions that undermine or threaten the territorial integrity, sovereignty and independence of Ukraine."

Cautionary tales

Revolut's Lithuanian issues are not yet resolved. Early in 2022, the country's central bank disclosed that it had identified deficiencies in Revolut's procedures, including the failure to warn senior managers when accounts were opened for politically exposed clients or those with a higher risk of money laundering and terrorism financing.

Also, it was fined €200,000 for failing to collect necessary client and transaction information. Revolut stated at the time that it has taken measures to repair and avoid future breaches. It stated that it had worked closely with the Lithuanian regulator to enhance its processes regarding the two issues, the majority of which had been resolved. It was stated that the remaining issues were "in the final stages of being addressed."

In November of last year, the Lithuanian central bank penalized the fintech company an additional €70,000 for failing to submit audited financial statements on time. Revolut asserted that the delay in filing the financial statements was due to "technical reasons" and connected to the migration of some clients following Brexit.

The way forward

In the meantime, despite the issues, Revolut's application for a banking license in the United Kingdom may be approved within weeks, according to rumors.

A source from a competing bank told the Observer, "We can’t understand how that could be the case. Some might complain that they’re not reaching the standards the regulators demand of us, like filing accounts on time. Why is this OK and what are you doing to the sector by allowing this?"

An FCA official, commenting on the condition of anonymity, told the newspaper that the regulator must be pragmatic: "We may find it’s better to have Revolut pissing into the tent, so we can get a better look at what gets wet, than if it’s outside in the dark. After a certain point, it has become so big that we need it in our regulatory orbit."

A spokeswoman for the FCA stated, "All firms seeking authorisation must be able to prove to us they meet minimum standards. This is crucial to the UK’s competitiveness, as it helps ensure people and businesses can trust the financial services being provided."

A spokesperson for the UK Treasury stated that the chancellor, Jeremy Hunt, had "ambitious plans for the UK to become a technology superpower" and had held discussions with "a range of promising tech firms in the UK to explore how we can grow the sector – boosting investment, jobs, and opportunity right across the country."


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