INSUBCONTINENT EXCLUSIVE:
This hasn&t been a good week for challenger bank Revolut
The company, which offers digital banking services and is valued at $1.7 billion, confirmed today that embattled CFO Peter O&Higgins has
resigned and left the business.
The startup and O&Higgins have been under pressure after a Daily Telegraph report that revealed that Revolut
switched off an anti-money laundering system that flags suspect transactions because it was prone to throwing out false positives.
According
to the Telegraph, the system was inactive between July-September 2018, which potentially allowed illegal transactions to pass across the
Revolut did not contact the Financial Conduct Authority to inform the regulator of the lapse, Telegraph reporter James Cook
said.
O&Higgins, who joined the company from JP Morgan three years ago, made no mention of the saga in his resignation statement:
Having
been at Revolut for almost three years, I am immensely proud to have taken the company from £1m revenue to £50m revenue during this time
However, as Revolut begins to scale globally and applies to become a bank in multiple jurisdictions, the time has come to pass the reigns
over to someone who has global retail banking experience at this level
My time at Revolut has been invaluable and I&m so proud of what myself and the team have achieved
There is no doubt in my mind that Revolut will go on to build one of the largest and most trusted financial institutions in the world.
In a
separate statement received by TechCrunch, Revolut CEO Nik Storonsky said that O&Higgins had been &absolutely pivotal to our
success.&
Update: Storonsky also responded to the Telegraph story with a blog post that denies any wrongdoing
He claimed Revolut suspended the use of &a more advanced sanctions screening system& and instead reverted to a previous one.
Here an
excerpt:
At no point during this time did we fail to meet our legal or regulatory requirements
We conducted a thorough review of all transactions that were processed during this time, which confirmed that there were no breaches
Unfortunately, this fact was not included in the original news story
This roll-out did not result in a breach of any sanctions or money laundering laws and requirements & so we did not send a formal
notification to the regulator.
The original version of this post continues below…
The resignation caps a terrible few days for Revolut,
which was the subject of a report from Wired earlier this week that delved into allegations around its challenging workplace culture and
high employee churn rate.
&Former Revolut employees say this high-speed growth has come at a high human cost & with unpaid work,
unachievable targets, and high-staff turnover,& wrote guest reporter Emiliano Mellino, citing the experiences of numerous former
employees.
Those incidents included prospective staff being told to canvass for new customers as part of the interview process
The candidates were not compensated for their efforts, according to Wired
Revolut later removed the demands from its hiring processes.
Revolut is headquartered in the UK, where it launched its service in the summer
Today, it claims over four million registered users across Europe — it is available in EEA countries — although it plans to extend its
presence to other parts of the world are taking longer than expected.
The company said last year it aims to launch in Singapore and Japan in
Q1 of this year — so far neither has happened — while it also harbors North American market plans
and Canada were supposed to happen by the end of 2018, according to an interview with Storonsky at TechCrunch Disrupt in September, but they
also appear to have been delayed.
Revolut is generally considered to be the largest challenger bank in Europe, in terms of valuation and
registered users, but other rivals include N26, Monzo and Starling
Even Transferwise, the global remittance service, now includes border-less banking features and an accompanying debit card.
