Yahoo Finance Wise: City watchdog investigating fintech CEO after he ‘failed to pay taxes’
The UK’s Financial Conduct Authority has launched an investigation into Kristo Käärmann, the co-founder and chief executive of payments app Wise (WISE.L), after he failed to pay his taxes.
Käärmann was included on HM Revenue and Customs’ list of deliberate tax defaulters in September 2021, after failing to comply with his tax obligations. He failed to pay £720,495 ($887,055) for the 2017-18 tax year and received a fine of £366,000, the tax authority said.
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The City regulator has now said it's examining the “regulatory obligations and standards to which Käärmann is subject”.
The regulator has the power to rule that Käärmann is not a fit and proper person to be a senior manager of an investment firm.
Shares in Wise were up slightly in early morning trading on Monday to 382p.
Wise chairman David Wells said: “The board takes Kristo’s tax default and the FCA’s investigation very seriously.
“After reviewing the matter late last year, the board required that Kristo take remedial actions, including appointing professional tax advisers to ensure his personal tax matters are appropriately managed.
“The board has also shared details of its own findings, assessment and actions with the FCA and will co-operate fully with the FCA as and when they require, while continuing to support Kristo in his role as chief executive.”
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Wise, formerly known as TransferWise, is one of London’s most prominent fintech firms, after its shares floated on the London Stock Exchange (LSEG.L) in July 2021.
It provides international money transfer and multicurrency banking services to consumers and businesses, competing with the high street banks.
Käärmann and co-founder Taavet Hinrikus, both from Estonia, founded the company to tackle the cost of transferring money between the UK and the Baltic country. Käärmann still owns 19% of the firm.
