Revolut is dealing with potential money laundering activity

[Martin Everson]

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Revolut is dealing with potential money laundering activity

UK neobank Revolut discovered potential money laundering activity on its digital payments system a few months back, according to the Financial Times. It has since informed the National Crime Agency (NCA) and the Financial Conduct Authority (FCA) about the suspected illicit activity. Contacting both regulators about the matter suggests that the severity of the issue is high, as conventionally companies just inform the NCA.

BI Intelligence
Here are two key takeaways from this development:

• Revolut's compliance checks may not be sufficient. People familiar with the matter told the FT that Revolut uses automated compliance checks to allow customers to open accounts within minutes. They explained that these automated checks could leave it vulnerable to illegal activity. Revolut founder Nikolay Storonsky said the company was recently re-authorized under the EU's second payments services directive, and its anti-money laundering controls passed a review from the FCA. However, that money laundering has potentially occurred does call into question whether the checks are enough.
• The neobank's rapid expansion could be eating up resources. Revolut has announced many expansion efforts recently, including plans to move into the US, Canada, Australia, New Zealand, Singapore, Hong Kong, and Japan. Additionally, it expanded its crypto offering earlier this year. These moves are likely taking a toll on the neobank's resources, which could be pulling its focus away from shoring up defenses against financial crime.

However, Revolut seems to be taking this potential money laundering incident seriously.While Revolut may not have had enough focus on security in the past, the fact that it notified both the NCA and FCA suggests that it is taking this incident seriously. Moreover, this could be wake-up call for Revolut to invest more time and resources into revamping its compliance efforts.

As such, it would be wise of the neobank to now look into ways it can improve these efforts, so there will be no repeat of this in the future and to reassure regulators and customers. This, in turn, could potentially hamper its expansion plans for the time being.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[David97255]

Martin Everson said:
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Revolut is dealing with potential money laundering activity

UK neobank Revolut discovered potential money laundering activity on its digital payments system a few months back, according to the Financial Times. It has since informed the National Crime Agency (NCA) and the Financial Conduct Authority (FCA) about the suspected illicit activity. Contacting both regulators about the matter suggests that the severity of the issue is high, as conventionally companies just inform the NCA.

BI Intelligence
Here are two key takeaways from this development:

• Revolut's compliance checks may not be sufficient. People familiar with the matter told the FT that Revolut uses automated compliance checks to allow customers to open accounts within minutes. They explained that these automated checks could leave it vulnerable to illegal activity. Revolut founder Nikolay Storonsky said the company was recently re-authorized under the EU's second payments services directive, and its anti-money laundering controls passed a review from the FCA. However, that money laundering has potentially occurred does call into question whether the checks are enough.
• The neobank's rapid expansion could be eating up resources. Revolut has announced many expansion efforts recently, including plans to move into the US, Canada, Australia, New Zealand, Singapore, Hong Kong, and Japan. Additionally, it expanded its crypto offering earlier this year. These moves are likely taking a toll on the neobank's resources, which could be pulling its focus away from shoring up defenses against financial crime.

However, Revolut seems to be taking this potential money laundering incident seriously.While Revolut may not have had enough focus on security in the past, the fact that it notified both the NCA and FCA suggests that it is taking this incident seriously. Moreover, this could be wake-up call for Revolut to invest more time and resources into revamping its compliance efforts.

As such, it would be wise of the neobank to now look into ways it can improve these efforts, so there will be no repeat of this in the future and to reassure regulators and customers. This, in turn, could potentially hamper its expansion plans for the time being.
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@Martin Everson it s your first funny post , I give you one like 🙂

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Scammed people on the forum!

 

[Martin Everson]

David97255 said:
@Martin Everson it s your first funny post , I give you one like 🙂
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lol.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[negon]

Well well, nothing shocking in this article! Time will tell if they survive or die!

 

[Martin Everson]

I think nothing will happen. However with the CEO being Russian....sorry I mean British anything can happen these days ns2

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[David97255]

Martin Everson said:
I think nothing will happen. However with the CEO being Russian....sorry I mean British anything can happen these days ns2
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You never know with a good nominee coo-:!y

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Scammed people on the forum!