UK: Revolut reports suspected money laundering on its digital payments to law enforcement and financial authorities
"Revolut reports suspected money laundering on its system", 17 july 2018
Revolut discovered a spate of suspected money laundering on its digital payments system a few months ago, prompting the UK's fastest growing financial technology company to tell law enforcement authorities and the financial watchdog. The act of reporting the suspected criminal activity to both the National Crime Agency and the Financial Conduct Authority underlines the significance of the potential wrongdoing that Revolut found. It also highlights how seriously the company takes its legal obligations.
However, the incident could be seized on by Revolut's critics to ask whether it can maintain strong enough defences against financial crime while pursuing its super-charged growth strategy. It is currently advertising for its third compliance head in the past year...The Financial Times has spoken to several current and former Revolut employees, as well as rivals and regulatory officials, about the company's efforts to stay on top of its commitments for fighting financial crime. The NCA and FCA declined to comment. Many of the people said that Revolut's rapid growth and use of automated compliance checks, which make it popular with customers who can open an account in only a few seconds, could leave it vulnerable to abuse by increasingly sophisticated financial criminals...
Mr Storonsky suggested that it had more rigorous checks than big banks like HSBC, which employs thousands of compliance staff, as he demonstrated its new transaction monitoring system that ranks each payment by its riskiness: A Russian cash withdrawal is rated high risk while a payment to a UK bank account is low risk. "Depending on who you send money to it is weighted by risk and that accumulates," he said.