[UPDATED: April 9, 7:41 pm
, Kyiv time. Added comments from Revolut’s press office]
The prominent European fintech company Revolut was fined €3.5 million ($3.8 million) by Lithuania’s central bank for failing to properly adhere to anti-money laundering regulations.
Lithuania’s central bank reported it had completed a routine check of Revolut Bank UAB, which holds the company’s European banking license and announced the fine on April 8, the official website wrote.
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It’s the largest fine Lithuania has ever issued, Tech.eu wrote.
Lithuania’s regulator said it had identified violations and shortcomings in the monitoring of business relationships and transactions. Saying that Revolut did not properly identify suspicious monetary operations or transactions.
Revolut acknowledged the violations and says it has taken actions to fix the problems, Lithuania’s central bank wrote. The two sides signed an “administrative agreement” that allowed the bank to issue a fine without going through a lengthy legal process.
“The amount of the fine was calculated taking into account the nature, duration and extent of the violations, as well as the gross annual income of the bank’s parent company, which has its registered office in the Republic of Lithuania,” according to the press release.
Revolut said it is working closely with the regulator and has already made changes to improve its internal controls. “We are committed to the highest standards of compliance and are continuing to invest in systems to fight financial crime,” a spokesperson said.
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Revolut later responded to Kyiv Post’s request for comment via email and said it cooperated with the Bank of Lithuania in taking immediate action to address the procedural deficiencies.
Revolut added that “the Bank of Lithuania’s investigation did not identify any confirmed instances of money laundering” and that the findings are “related to improvements of existing controls.”
“Revolut Bank UAB is committed to the highest standards of regulatory compliance,” Revolut’s press office told Kyiv Post.
“We continue to invest to ensure we have best in class controls in the fight against financial crime,” it added.
The fine comes just a day after it was reported that Revolut stopped accepting new users in Ukraine, according to a report by Developers.Org.UA (DOU). The news first appeared on the Telegram blog Taras Guk. Investments, Finance, Business, and was later confirmed by Revolut to the media outlet.
“Revolut Bank UAB has temporarily suspended the registration of new customers who are residents of Ukraine,” the company said. “This does not affect our existing Ukrainian users.”
While Revolut didn’t give a specific reason, the author of the post, Taras Guk, speculated that the National Bank of Ukraine (NBU) may have been involved, possibly because Revolut doesn’t yet have a full license to operate in the country.
Lithuania is not the only country where Revolut has come under scrutiny. The bank faced ongoing regulatory challenges in Ukraine, where Ukraine’s NBU said in a press release that Revolut “is not undergoing the licensing procedure.”
The NBU also warned Ukrainians that Revolut’s services are not protected by local laws, and the company does not fall under Ukrainian jurisdiction.
What concerned the NBU is that Revolut announced its entry to Ukraine without undergoing the formal licensing procedure with the NBU, which could mislead consumers into thinking that Revolut operates like a regular bank in Ukraine, when in fact it isn’t – for now at least.
“Revolut may violate legislation on advertising financial services and misleading consumers with statements like ‘Revolut has entered the Ukrainian market.’ In reality, Revolut has not entered the Ukrainian market – it only opens accounts for Ukrainians but does not operate in Ukraine as other banks do,” а former NBU employee told Kyiv Post.
Revolut previously emailed Kyiv Post to say the company is not entering the Ukrainian market, and that it is only providing services to clients in Ukraine by offering “EU accounts only.”
Revolut also faced significant hurdles in securing a full banking license in the UK due to concerns over its internal controls, specifically related to money laundering and corporate culture, The Guardian reported in July 2024.