Wise Faces Investigation for Possible Anti-Money Laundering Failures

Wise is facing an investigation in Europe related to possible criminal usage of its services.

The money transfer company confirmed the investigation in a statement issued Monday (June 1), following a report from the The Bureau of Investigative Journalism that the Public Prosecutor’s office in Belgium is concerned the company’s accounts have been used for money laundering.

“We are currently working with the Brussels prosecutor to respond to queries about our business, as we routinely do with regulators and law-enforcement authorities,” Wise said in its statement.

“His office’s enquiries are still incomplete and no specific findings have been shared with us to date. As such, it would be speculative for us to comment on any allegations. We will continue to engage with the Brussels prosecutor’s office if and when any specific findings are made available to us.”

According to Bureau report, the investigation began last year when authorities noted that London-based Wise’s accounts had been involved in hundreds of requests for cross-border payments in criminal proceedings throughout Europe. The transactions in question came to roughly 500 million euros, or $582 million.

The report adds that the Belgian prosecutor’s office has said it is investigating “indications of non-compliance with anti-money laundering (AML) legislation” by Wise.

In it statement, Wise noted that around a third of its workforce is focused on financial crime prevention. The company also pointed out that it holds more than 80 regulatory licenses, and that it, like other financial institutions, faces the “reality of increasingly sophisticated bad actors attempting to exploit our platform, and we continually invest in tech-enabled systems and teams to stay ahead of ever-evolving threats.”

Wise expanded its financial crime operations in Europe after the National Bank of Belgium found a shortcoming in its AML controls in 2022, part of a remediation plan from that regulator.

And last year, Wise’s American operation paid a $4.2 million settlement to six state regulators following allegations that the company had deficiencies in its AML, Bank Secrecy Act, and Countering the Financing of Terrorism (CFT) programs.

The news comes weeks after Wise began trading on the Nasdaq, while maintaining a secondary listing in the U.K.

PYMNTS wrote earlier this year about the pressures facing companies when it comes to cross-border payments, which “sit at the intersection” of AML rules, as well as sanctions, payments regulation and data protection regulations.

“These regimes are enforced nationally and regionally, but they are increasingly shaped by global standards that expect richer data, faster monitoring and more proactive risk management,” that report said.

“The emerging question facing finance leaders then is how to embed smarter controls and real-time visibility into cross-border flows without slowing the business down or fragmenting the customer experience.”