Belgian Authorities Probe Wise
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Wise shares came under heavy pressure on Monday after the fintech company confirmed it was responding to questions from Belgian authorities following reports of an investigation linked to potential money laundering concerns.
The London-founded financial technology company saw its stock tumble by nearly 20% during trading before recovering some losses and closing around 14% lower. The sharp decline followed reports that prosecutors in Brussels were examining whether Wise accounts had been used to launder proceeds from criminal activity.
The development placed renewed focus on compliance practices across the fintech sector and triggered a broader discussion around anti-money laundering controls at fast-growing financial services firms.
Belgian Authorities Probe Wise Over Reported Investigation
The concerns emerged after a report from the Bureau of Investigative Journalism claimed Belgian authorities had opened an investigation last year into Wise’s European operations.
According to the report, investigators were examining transactions valued at approximately 500 million euros, or about £432.8 million. The report alleged authorities were reviewing whether some accounts connected to the platform may have been used in money laundering activity. Wise acknowledged that it was engaging with prosecutors in Brussels regarding questions about its business. The company said it was working with the Brussels prosecutor’s office and emphasized that inquiries remained ongoing. It added that no specific findings had been communicated to the company so far.
Wise stated that commenting further on allegations would be speculative while inquiries remained incomplete. The company also stressed that requests for information from regulators and law enforcement agencies are a routine part of operating a global financial services platform and should not automatically be interpreted as evidence of wrongdoing or non-compliance. The comments came as investors reacted sharply to the possibility of a compliance investigation involving one of the UK’s most prominent fintech firms.
Market Reaction Sends Wise Stock Price Lower
The announcement weighed heavily on investor sentiment. Wise shares fall headlines dominated financial technology news throughout Monday as traders assessed the potential implications of the reported probe.
The company recently shifted its primary listing from London to New York, seeking access to a broader investor base and deeper capital markets. It continues to maintain a secondary listing in London. The stock market drop marked one of the company’s steepest single-session declines in recent months.
Analysts noted that regulatory scrutiny can have a significant impact on fintech stocks, particularly when investigations involve anti-money laundering compliance. Investors often focus not only on potential penalties but also on the reputational risks associated with such cases.
The reported Wise money laundering investigation comes at a time when regulators across multiple jurisdictions are increasing scrutiny of digital payment providers and global money transfer platforms. Wise’s European business operates from Belgium, making the country a key regulatory hub for its activities across the European Union.
Company Highlights Compliance Efforts
In response to the scrutiny, Wise pointed to its existing compliance infrastructure and financial crime prevention measures. The company said around one-third of its workforce is dedicated to protecting customers from financial crime. It added that anti-money laundering safeguards are integrated across different departments within the business.
According to Wise, customers undergo identity verification before opening accounts. The company also reviews transactions and monitors hundreds of data points in real time as users interact with its services.
Wise stated that combating financial crime remains an industry-wide challenge and said it takes those responsibilities seriously. The company has previously faced regulatory action. In 2022, when operating under its former name TransferWise, the firm was fined 360,000 US dollars by Abu Dhabi’s financial services regulator for breaches of anti-money laundering requirements.
Wise, launched in 2011, has grown from a specialty money transfer business to a significant worldwide payments platform. Today, the organization has more than 19 million customers worldwide and handles about 4.7 million transactions daily.
The latest developments come as investigators continue their inquiries into Wise Brussels operations. No results have been revealed yet, but the rumored probe has already had a considerable impact on the Wise share price and investor confidence. As the compliance probe continues, market players are expected to focus on any fresh disclosures from Belgian prosecutors and future disclosures from the firm.
This content was adapted from an article in Standard.co