N26 fined €4.25m for weak money-laundering controls

German monetary watchdog BaFin has publicly rebuked on-line financial institution N26 for weak anti-money laundering controls and imposed a €4.25m positive on the fast-growing lender.

BaFin has already ordered the enterprise, which is one in every of Europe’s most extremely valued fintechs, to strengthen its money-laundering prevention twice since 2019. In a uncommon transfer this Might, BaFin additionally put in a special supervisor to observe the financial institution.

The €4.25m positive was paid in July however solely made public by the regulator on Wednesday. N26 stated in an announcement that it associated to the late submitting of near 50 suspicious exercise stories in 2019 and 2020.

The positive comes someday after Germany’s largest on-line financial institution, ING Germany, was criticised in courtroom by a BaFin consultant for its sluggish response to suspicious trades by a consumer, who later admitted to large-scale insider buying and selling.

N26, which earlier this yr stated that it was working in direction of a public itemizing, was valued at $3.5bn in a funding round in 2020. It was based in 2013 and has raised near €800m from buyers together with Tencent, Allianz X and Peter Thiel. It says it has greater than 7m purchasers in 25 nations.

The financial institution stated in an announcement that it had already addressed the issues behind the BaFin positive. “All measures to enhance stories of suspicious actions have been carried out earlier this yr,” N26 stated, including that it takes its “duty within the combat in opposition to the rising risk of world monetary crime, and within the prevention of cash laundering, very severely”.

In Might, BaFin urged the lender to “rectify deficiencies each in IT monitoring and in buyer due diligence” and to “be sure that it has the ample personnel, technical and organisational sources to adjust to its obligations below anti-money laundering legislation”.

N26 stated it has taken “quite a few detailed measures” to strengthen its anti-financial crime controls.