28th Oct 2024 09:29
(Alliance News) - The UK Financial Conduct Authority on Monday said it has fined the chief executive of Wise PLC for failing to notify it about "significant tax issues".
The FCA said Kristo Kaarmann, who co-founded Wise in 2011, failed to initially notify the regulator about a previous tax issue and fine during an assessment of his fitness and propriety in 2021.
As a result, the financial watchdog fined Kaarmann GBP350,000.
Kaarmann had been fined GBP365,651 by UK tax collector HMRC, relating to an outstanding capital gains tax bill for the 2017-18 tax year.
The FCA said that between February and September 2021, the HMRC fine, including the circumstances surrounding it, were relevant to the FCA's assessment of Kaarmann's fitness and propriety to run a financial services firm such as Wise.
Wise is a London-based money transfer services provider.
The regulator added that Kaarmann failed to "appropriately consider the significance of the tax issues and notify the FCA, despite being aware of them for over seven months".
Kaarmann's fresh fine was reduced from a potential GBP500,000 after agreeing to resolve the matter.
Commented Therese Chambers, joint executive director of enforcement & oversight at the FCA: "We, and the public, expect high standards from leaders of financial firms, including being frank and open."
"It should have been obvious to Kaarmann that he needed to tell us about these issues, which were highly relevant to our assessment of his fitness and propriety."
Wise Chair David Wells said: "The board continues to take Wise's regulatory obligations very seriously. We're pleased that the FCA's conclusions are consistent with Wise's own assessment in 2021, and that the matter is now closed in its entirety.
"The board also required [Kaarmann] to take remedial actions to ensure that his personal tax affairs are appropriately managed and is satisfied that these actions were taken."
Wise shares were 1.2% lower at 726.50 pence each on Monday.
By Jeremy Cutler, Alliance News reporter
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