Payments provider Wise hoped that by moving its stock market listing from London to New York it would gain “greater awareness” among potential investors and customers. It has indeed garnered attention, but not just the good kind. Wise’s shares dropped as much as 20 per cent on Monday, before partially recovering, when it said it was being investigated over potential money laundering offences.
When moving money from A to B is a company’s raison d'être, knowing where said money originated is fundamental — and regulators are understandably watchful. The investigation by Belgian authorities is ongoing and no charges have been brought. But at best, it’s unhelpful for a company that has previously faced criticisms from watchdogs in Brussels, New York and Abu Dhabi. And Wise is not the only one: Starling, Monzo and Revolut have all had run-ins of differing kinds.
While this may look like a fintech problem, it’s really a finance problem. After all, it is hard to find a major bank that hasn’t also run into some sort of trouble. In the past year alone, everyone from international group such as UBS and JPMorgan Chase to British building society Nationwide has been fined for financial crime failures.