Revolut, the UK’s most valuable fintech startup, has been slapped with a €3.5 million ($3.83 million) fine by Lithuania’s central bank over anti-money laundering (AML) compliance failures. The penalty, announced Monday, is the largest ever imposed by Lithuania’s financial regulator, underscoring growing scrutiny of the fast-growing neobank.
Regulatory Red Flags
The fine follows a routine inspection that uncovered serious lapses in Revolut’s AML protocols, including failures in monitoring business transactions and identifying suspicious activities. According to the central bank, these deficiencies left Revolut unable to flag potentially illicit transactions properly.
Follow THE FUTURE on LinkedIn, Facebook, Instagram, X and Telegram
While the regulator did not specify whether actual money laundering had occurred, Revolut was penalized for procedural gaps rather than confirmed illicit activity. In response, the company emphasized that the investigation did not find any direct money-laundering violations but rather areas where its internal controls needed strengthening.
Revolut’s Response
A Revolut spokesperson stated that the firm immediately addressed the identified weaknesses and worked closely with Lithuanian regulators to reinforce its compliance framework.
“Revolut Bank is committed to the highest standards of regulatory compliance and took swift action to remediate procedural shortcomings,” the spokesperson said.
Revolut has since signed a settlement agreement with the Lithuanian central bank and implemented corrective measures to align with regulatory expectations.
A High-Stakes Fine For A High-Value Fintech
This regulatory setback comes as Revolut continues its meteoric rise in the fintech world. Valued at $45 billion following a recent secondary share sale, the London-based company has outpaced several of Europe’s biggest banks in market worth.
Despite the fine, Revolut remains financially robust, having reported a record-breaking £438 million ($559.5 million) pretax profit in 2023. However, the regulatory hit underscores the increasing pressure on fintech firms to tighten compliance as they scale globally.
With EU regulators keeping a close watch on digital banking disruptors, Revolut’s fine serves as a stark reminder: growth cannot come at the expense of regulatory vigilance.
