Report: Revolut under UK watchdog scrutiny over red-flag accounts


The London-based fintech is suspected of letting funds flow from restricted accounts.

Revolut is currently under the scrutiny by UK financial regulators due to alleged technical failures that allowed funds to be released from accounts flagged by the National Crime Agency (NCA) as suspicious. 

A Financial Times report said the incident might affect Revolut’s application for a UK banking license but the fintech is “actively cooperating” with the Financial Conduct Authority (FCA), which is responsible for overseeing Revolut's payment operations. 

The alleged failures took place between July and August 2023 and involved as much as 1.7 million pounds, according to FT sources. Revolut claimed only half a million pounds had been released. Both the NCA and the FCA have not elaborated on the topic on their websites. 

The NCA has the authority to restrict accounts suspected of being involved in money laundering or illicit financial activities, allowing law enforcement to investigate before permitting further fund withdrawals.

Concerns about Revolut's controls against financial crime and money laundering have long been a focus of regulators overseeing the company's global operations. This includes a previous incident where a flaw in its payment system enabled US criminals to steal more than 20 million US dollars.

The fintech has been in negotiations with the FCA for about two and a half years regarding the issue of a banking license to expand its presence in its home market.

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Since its establishment in 2015, Revolut has obtained over 70 licenses for various financial services, building trust and confidence among its 30 million plus customers.

Founded by Nik Storonsky, a Russian-born businessman naturalized in the UK, and Vlad Yatsenko, a British national with Ukrainian roots, the company seeks to disrupt the cross-border payments market by offering a wide range of services, including cryptocurrency trading, savings, wealth management, and banking services for small and medium-sized businesses.

It has held a full banking license in Lithuania since 2021, allowing it to provide banking services across the European Economic Area. Following a 2021 fundraising round that valued the company at 33 billion dollars, it became the UK's most valuable private technology company. 

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