CEO of Revolut denies allegations of money laundering and negligence

05 Mar, 2019
by Joeri Cant
CEO of Revolut denies allegations of money laundering and negligence

The founder and CEO of United Kingdom-based digital banking app Revolut, Nik Storonsky, denied allegations of a money laundering breach and negligence, which was alleged by the UK newspaper The Telegraph.

According to Cointelegraph, the U.K. newspaper the Telegraph alleged that Revolut executives had deliberately decommissioned Anti-Money Laundering (AML) software earlier last year.

They further claimed that The Financial Conduct Authority was seeking answers from Revolut, the UK's fastest growing digital bank, amid questions over its compliance procedures. 

Apparantly a system used by the London-based startup to prevent money laundering and other illegal activity was switched off. Instead the firm, which has 3 million customers, changed to a system which flagged suspicious transactions only after they had taken place.

Now the founder and CEO of United Kingdom-based banking app, Nik Storonsky, came forward in an attempt to set the record straight.

'This week, there's been some misleading information in the media relating to our compliance function', the CEO said.

According to the CEO, Revolut had opted to revert to its previous AML systems after an upgrade failed to produce adequate security.

He added that 'at no point during this time did we fail to meet our legal or regulatory requirements. We conducted a thorough review of all transactions that were processed during this time, which confirmed that there were no breaches.'

'Unfortunately, this fact was not included in the original news story. This roll-out did not result in a breach of any sanctions or money laundering laws and requirements - so we did not send a formal notification to the regulator.'

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However, it turns out that police did launch an official fraud investigation over a complaint on a money transfer by British digital bank Revolut, adding further pressure to the fintech company that is already facing investigations on other issues from regulators.

The City of London Police confirmed that an investigation by the National Fraud Intelligence Bureau was instigated, after the Metropolitan Police received a complaint about the London-based company in early February.

Revolut declined to comment on the FCA investigation.

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