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Wise shares fall after billionaire CEO Kristo Kaarmann’s tax blunder

·1-min read
Kristo Kaarmann, right, with Wise cofounder Taavet Hinrikus  (Wise)
Kristo Kaarmann, right, with Wise cofounder Taavet Hinrikus (Wise)

Shares in international money transfer business Wise came under pressure today after it emerged that its billionaire CEO had been fined for messing up his taxes.

Kristo Kaarmann, the cofounder and CEO of Wise, was charged £365,651 for a deliberate default during the 2017/18 tax year, the Telegraph reported. A spokesperson said the hefty fine came after the chief exec forgot to file his taxes in a year where he owed the tax man £720,495.

“Kristo was late submitting his personal tax returns for the 2017/18 tax year, despite sufficient reminders from HMRC,” a spokesperson said. “His tax returns have since been completed, and he paid substantial late filing penalties. He has since devoted more time to keeping his personal admin in order.”

The disclosure is embarrassing for Wise and could raise questions about Kaarmann’s competency. The company’s stock lost 27.50p, a fall of 2.4%,on the news.

Estonian Kaarmann cofounded online money transfer business Wise - originally called TransferWise - in London in 2010. The company went public earlier this year in a blockbuster £8 billion IPO. Kaarmann’s 18% stake in the business makes him a paper billionaire.

Wise offers low-cost online money transfer services around the world and transfers over £5 billion each month. It has since branched out into other services such as money cards and multi currency accounts.

A spokesperson for HMRC and the FCA both declined to comment on the specifics of the matter to the Telegraph.

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