Revolut, a UK digital bank, has been subject to regulator scrutiny for inconsistencies during its auditing process. FT reported, citing sources familiar with the matter that the Financial Reporting Council had criticized BDO’s audit of an unidentified financial services provider as “inadequate”.
Further, the FRC revealed that there was a high “risk of an undetected matter misstatement”. FT later discovered that Revolut was actually the “financial service provider.”
Tensions between Regulators and Revolut Spill Over
FT’s source said that British fintech company must improve its internal controls. One source claimed,
“The regulators are making it more difficult for auditors now.”
According to the report, additional delays may occur when Revolut subsidiaries are required to file accounts. Revolut Ltd. and Revolut Group Holdings Ltd. are required to file 2021 accounts by September end. Revolut Travel Ltd., and Revolut FIC Ltd. will also be filed at the same time.
The company is behind on filing Revolut NewCo UK accounts, which were due June 10. According to a source familiar with the matter, these delays could result in the prosecution of Nikolay Storonsky, founder and CEO of Revolut.
Revolut Hires and Departures
This news comes just over a month following Revolut’s resignations from UK compliance and risk chiefs. The company was still at the crossroads of regulators, causing delays in the company’s banking license.
Revolut, Europe’s second-most valuable fintech company, saw five of its top executives leave. They include Victoria Stubbs (UK chief risk officer), Justine Wootton (UK Head of Regulatory Compliance) and Mathew Seneviratne (UK Money Laundering Reporting Officer) – all in addition to the UK data protection officer and UK Deputy MLRO.
The London-based fintech company may have suffered a setback as it now plans to hire 20% more crypto-focused employees in the UK, US and Europe over the next six-months.
CryptoPotato reported earlier that Revolut was advertising 13 roles in the industry, including software engineers, financial compliance, and criminal prevention experts. This is after Revolut had increased its headcount by almost 200%.
The post UK Regulators Slam Crypto Friendly Revolut over Flawed Audits: Report first appeared on CryptoPotato.
Marla Brooks – Financial Analysis
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