British regulator investigates Wise chief after tax default

Fintech group listed on London Stock Exchange last year with £8bn valuation

Money transfer company Wise said on Monday that Britain’s Financial Conduct Authority (FCA) has launched an investigation into its chief executive Kristo Käärmann after he was named on a list of tax defaulters.

In September last year, the British tax authority (HMRC) included Mr Käärmann in a list of people penalised for tax defaults. A spokesperson for Wise said Mr Käärmann was late paying his taxes in 2018 and had been fined.

Mr Käärmann’s £365,651 (€424,130) penalty relates to a tax bill of £720,495, according to the information published by the government.

HMRC regularly publishes a list of people who deliberately default on their taxes, such as by filling in erroneous tax returns.

The investigation will come as a blow to one of the UK’s highest-profile fintech companies, which listed on the London Stock Exchange only a year ago with a value of £8 billion. Mr Käärmann co-founded Wise, the British financial technology firm previously known as TransferWise, with Taavet Hinrikus in 2011.

Following the publication, Wise started an investigation with support from an external law firm. That concluded at the end of 2021 and its findings were passed on to the FCA, the company said.

The FCA has now launched its own investigation regarding the regulatory obligations and standards to which Kristo is subject, Wise said.

“Kristo intends to co-operate fully with the FCA in its investigation,” said the company. – Reuters