In a significant escalation for the international money transfer platform, Wise is currently embroiled in a Belgian investigation over serious concerns that its accounts may have been exploited for money laundering activities. Belgian prosecutors have confirmed to French media that this inquiry is rapidly approaching its conclusion, with alarming implications regarding the company's anti-money laundering (AML) controls.
At the heart of the investigation lies an alarming report by The Bureau of Investigative Journalism (TBIJ), which alleges that Wise's systems were implicated in roughly €500 million (£432 million) worth of suspicious transactions spanning 30 European countries. As a direct response to these developments, shares of the dual-listed company dropped 17.5% in trading on news of the inquiry.
Wise, which boasted a customer base of 19 million last year, has stated that it is fully cooperating with the Brussels prosecutor's office, albeit noting that "no specific findings have been shared with us to date." A spokesperson for the prosecutors emphasized that the investigation, focused exclusively on Wise's European operations, reveals apparent non-compliance with vital anti-money laundering legislation, particularly in identifying customers and assessing their activities.
In its own statement, Wise reiterated its commitment to transparency and compliance: "We routinely engage with regulators and law enforcement to address inquiries about our business. Requests for information are a normal part of operations and do not necessarily indicate any wrongdoing." Nevertheless, the company faces heightened scrutiny as it grapples with an increasingly complex landscape of financial crime.
This investigation is not the first time Wise has found itself under the microscope for its AML practices. The Financial Times reported in 2024 that the National Bank of Belgium had flagged significant gaps in Wise's customer verification processes, leading to regulatory actions that saw the firm fined in multiple jurisdictions. Just last year, Wise paid $4.2 million (£3.1 million) in fines across six US states for AML compliance failures and another $360,000 to Abu Dhabi's financial services regulator.
Wise, founded in London in 2011, processes about 4.7 million transactions daily, facilitating cross-border money transfers for millions globally. Following its recent shift to a primary listing on the NASDAQ in the US, the company is acutely aware of the stakes involved as it navigates this pivotal moment. In a statement on Monday, Wise acknowledged that, like all financial institutions, it faces threats from sophisticated criminal enterprises seeking to exploit its platform. The firm maintains that it takes financial crime seriously, dedicating approximately a third of its workforce globally to safeguarding customer interests.
The unfolding situation presents a crucial test for Wise's operational integrity and regulatory compliance, as it races to demonstrate that it is capable of thwarting the increasingly complex tactics of financial criminals.
Source: BBC News
Source: BBC News - Business