8.6 C
New York
Tuesday, June 22, 2021
Home Challanger banks BaFin: N26 needs to improve money-laundering prevention

BaFin: N26 needs to improve money-laundering prevention

The German financial supervisory authority BaFin is dissatisfied with the money laundering prevention at N26.

The regulator is sending a special representative to the challenger bank. So far, this has only happened to one other bank in Germany.

Read also: Revolut appoints Mikko Salovaara as new CFO

In 2019, the BaFin had already investigated the N26 in the same matter. Since then, N26 has promised several times to cooperate and invest heavily in compliance with BaFin. However, the regulator is apparently not satisfied with what has been achieved.

The exact message goes like this: “On May 11, 2021, BaFin ordered N26 Bank GmbH to take appropriate internal security measures and to comply with general due diligence measures in order to prevent money laundering and terrorist financing. A special representative will be appointed to monitor the processing of the order and the status of the elimination of other identified deficiencies.”

N26 points out that it has already strongly advanced the expansion of preventive measures against money laundering in recent years. “Nevertheless, we recognize that more needs to be done in this area,” the company writes, attempting to explain: “Since the beginning of the corona pandemic, criminal activities in connection with online trading have increased significantly worldwide.”

“Fraudsters manipulate third parties into opening new accounts in order to use them for fraudulent purposes. The demands on banks in the fight against crime have increased,” N26 added.

A few months ago, N26 also announced that it seeks to transform itself into a financial holding. As a result, the entire group would now be monitored by BaFin and no longer just the N26 Bank part. 

In this context, co-founder Maximilian Tayenthal reported on having an “open and trusting dialogue with the supervisory authorities”.

Also, N26’s anti-money laundering key person, Thomas Ball, announced his departure from N26 on LinkedIn this week in a detailed post – but deleted it again shortly afterwards. Ball joined N26 in November 2018 from Deutsche Bank and officially held the title of “Group Money Laundering Officer”.

One of the most important tasks of the new CFO is likely to end Bafin monitoring quickly and remedy weaknesses in compliance. The new CFO, Jan Kemper, is an ex-ProSieben and Omio CFO and will take over this position at N26 in the second half of the year.

Avatar
Jan Cerny
Jan is an innovation enthusiast and Fintech news reporter. He specializes in news distribution, social media, and content analysis.

Recent posts

Revolut revenue grows but operating losses double to £201m

Revolut announced that 2020 adjusted revenues, that grew 57% to £261 million. However, operating losses in 2020 have doubled.

Bunq valued at 1.65 billion € after first investment

Dutch digital bank Bunq managed to close the very first funding round with an undisclosed British private equity firm.

Wise expects valuation of £9bn with new London listing

Wise, former TransferWise, is about to go public on the London Stock Exchange through a direct listing.

N26 exceeds 2 million customers in France

N26 announced that it has convinced 2 million French customers to use its services after 4,5 years since entering the market.