The Financial Conduct Authority (FCA) has imposed a £350,000 fine on Wise’s CEO, Kristo Käärmann, for breach of a senior manager conduct rule.
- The penalty arose from Käärmann’s failure to disclose a prior regulatory breach during an assessment of his fitness for the role.
- Käärmann was previously fined by HM Revenue and Customs (HMRC) for failing to notify them of capital gains tax liability.
- The FCA began its investigation into Käärmann in June 2022, citing non-cooperation with regulatory standards.
- Despite these issues, Wise continues to show positive growth in its quarterly earnings.
The Financial Conduct Authority (FCA) has concluded an investigation resulting in a substantial fine for Kristo Käärmann, CEO of Wise. The decision comes as Käärmann failed to disclose past regulatory breaches during the FCA’s review of his compliance with senior management conduct standards.
The FCA’s assessment identified that Käärmann had not fully addressed a previous £365,651 fine imposed by HM Revenue and Customs (HMRC). This fine was due to his deliberate omission to report a capital gains liability following the sale of shares worth £10 million in 2017. The omission led to Käärmann being listed as a tax defaulter by HMRC.
The FCA initiated an investigation in June 2022 to scrutinise Käärmann’s adherence to regulatory responsibilities and found that he did not cooperate as expected. This lack of disclosure and cooperation contravened the UK’s Senior Management Conduct rules, specifically rule four, which mandates full disclosure of relevant information to the FCA.
Therese Chambers, the joint executive director of enforcement and oversight at the FCA, expressed that it was evident Käärmann should have communicated these critical issues, given their impact on the FCA’s judgement of his professional competence. Käärmann’s fine, initially set at £500,000, was reduced due to his eventual cooperation in resolving the matter.
Despite these challenges, Wise has continued on its path of growth, having posted positive quarterly results, further solidifying its presence in the financial sector.
Wise, despite managerial scrutiny, maintains its trajectory of growth and success.
