BEFORE YOU GO...
Check how Shufti Pro can verify your customers within secondsRequest Demo
Bank of Lithuania is reportedly investigating UK fintech Railsr over Anti-Money Laundering and Counter-Terrorist Financing failings within its Lithuanian Subsidiary.
According to the reports, the Lithuanian Subsidiary of Railsr, PayRNet, is under investigation by the country’s central bank. PayRNet was registered as an electronic money institution under the licence from the Bank of Lithuania in 2020.
As per the statement from the Bank of Lithuania, “There is reason to suspect that the institution is grossly and systematically violating the Law on the Prevention of Money Laundering and Terrorist Financing.”
The reports reveal that the Central bank has applied for a court order that will instruct Railsr to stop onboarding new clients, also warning the firm “not to establish business relationships with new clients, as well as intermediaries and persons distributing and/or redeeming electronic money of this institution”.
In response to the situation, a spokesperson from Railsr said that it has already “offboarded” customers that do not meet the standards required. The firm is also in the process of generating an appeal to the Bank of Lithuania notice, “which has been issued ahead of any final review findings”.
“The reviews of our processes and intermediary activities are ‘backwards looking’ and as the Bank of Lithuania has only reached an interim review, we have not yet had a chance to give a management response on the historic controls and customers they have observed,” the Railsr spokesperson added.
It was reported that in January 2023, the African pay tech giant Flutterwave is aiming to acquire Railsr. Flutterwave announced its will to acquire Railsr just weeks after the fintech firm raised $46 million in a Series C funding round at a reduced valuation of $250 million.