The Financial Conduct Authority (FCA) and the National Crime Agency (NCA) in the United Kingdom have launched a joint investigation into fintech giant Revolut, focusing on the release of approximately £1.7 million from accounts that had raised suspicion. These funds in question were reportedly sourced from accounts that had been flagged as suspicious by the NCA.
The investigation has arisen from concerns about possible process failures within Revolut that occurred during the period of July to August. According to reports by the Financial Times, as much as £1.7 million was released from these flagged accounts. However, Revolut has contested this figure, stating that only £500,000 was actually released.
In response to the investigation, Revolut has chosen to remain tight-lipped, declining to provide any comments. Similarly, the NCA and FCA have chosen not to comment on the ongoing investigation.
Arnault’s spokesperson declined to comment. Sarkisov could not be immediately reached for comment.
It's noteworthy that Revolut's anti-money laundering (AML) and financial crime controls have been under regulatory scrutiny for some time. Previously, the company faced a significant issue when a flaw in its payments system enabled criminals in the United States to siphon off more than $20 million.
Revolut, a fintech giant with an extensive customer base, boasting 30 million retail customers globally, holds a customer base that is comparable in size to traditional banking institutions like Lloyds Banking Group, which serves over 30 million customers, far exceeding NatWest's customer base of 18 million.
This investigation in the UK coincides with ongoing negotiations related to Revolut's nearly two-and-a-half-year-old bid for a banking license, a crucial step to facilitate its growth in the domestic market. Interestingly, Revolut recently refrained from commenting on the status of its license application, which had been previously expected to be granted "any day now" as of March.
Revolut has emphasized its commitment to maintaining strong governance and compliance practices by collaborating closely with regulators worldwide. In the meantime, the company holds a full banking license in Lithuania since 2021, allowing it to provide banking services across the European Union.
At its peak, Revolut achieved a staggering valuation of $33 billion, marking its significant presence in the fintech sector. Furthermore, the company has recently announced a delay in the release of its 2022 financial accounts, with the new expected date being the end of December. The ongoing investigation and regulatory challenges pose significant considerations for Revolut as it navigates its path in the financial services industry.
By fLEXI tEAM