Russian Forbes reports that The Observer (owned by The Guardian) writes about this, citing sources among officials, bankers as well as Revolut’s current and former employees.
Revolut, which is valued at $33 billion, applied to the Financial Conduct Authority (FCA) for a license back in 2021 and has been awaiting a decision ever since. Meanwhile, the smaller competitors received permits in less time.
One of the reasons for the delay from the regulator is the corporate culture at the start-up and staff turnover, the newspaper writes. In 2019, it emerged that the FCA had investigated Revolut after a whistleblower claimed in 2016 that it did not carry out adequate money laundering controls. The FCA closed its investigation in 2017. Several compliance officers at UK high street banks said some industry peers remained concerned about the company. One said working at the fintech company was a “reputational risk too far for most reputable employees working in compliance”. In addition, former and current employees of the company have since 2019 complained to the media about difficult working conditions and a “toxic environment”.
The company said it was fully anti-money laundering compliant and has a “sophisticated suite of financial crime detection systems, including customer due diligence and transaction monitoring.” Revolut denied it had a toxic workplace culture or a problem with turnover from key positions, noting that they “have a high-performance culture.” Earlier this year, Revolut announced the hiring of a psychologist for its employees.
Another reason for the delay is the British regulator’s awareness of Revolut’s problems in Lithuania, where the company is located received a banking license in the EU in 2018, writes the newspaper. Since then, the startup has been fined twice: €200,000 for failing to collect sufficient information about customers and their transactions, and €70,000 for failing to submit audited financial statements on time. Revolut said at the time that it had implemented measures that would fix and help prevent future breaches and claimed that the delay in submitting the accounts was due to “technical reasons”.
In the UK, Revolut is also facing a fine for missing a deadline for group accounts covering the financial year 2021, the newspaper writes. The start-up said the auditors from BDO should be held responsible for the delay.
Another problem is the Russian origin of the founder of Revolut. Storonsky was born in the Moscow region and emigrated to the UK in 2004, obtained British citizenship, and in 2022 renounced Russian citizenship. His father (aka Nikolay Storonsky), heads Gazprom Promgaz and was put under Ukrainian sanctions.
People familiar with the matter told The Observer that intelligence officials are worried about it: embassy staff working in sensitive roles in the Five Eyes alliance – the intelligence-sharing network made up of Australia, the US, the UK, Canada and New Zealand – are discouraged from using Revolut. The Lithuanian parliament continued to raise concerns over Revolut’s operations, but failed to secure support for a third inquiry in spring 2019. They ultimately concluded that there was no evidence to suggest that Revolut posed a threat to national security.
Revolut stressed that Storonsky’s father – who is of Ukrainian descent – was “completely unconnected with Revolut”.
Despite the string of controversies, Revolut’s approval for a banking license could be granted within weeks, it is rumored. “We cannot understand how that could be the case,” a source at a rival bank told The Observer.
A Treasury spokesman said the chancellor had “ambitious plans for the UK to become a technology superpower” and talks were being held with “a number of promising technology firms in the UK to explore how we can grow the sector”. An FCA spokesperson said that all firms seeking authorization must be able to prove to us that they meet minimum standards. “This is vital to the UK’s competitiveness as it helps to ensure that people and businesses can trust the financial services on offer,” he noted.
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