Klarna has been fined $50 million in Sweden over faults in its anti-money laundering protections.
Sweden’s Financial Supervisory Authority, or FI, announced Wednesday (Dec. 11) that an investigation into the Swedish payments firm’s compliance with anti-money laundering (AML) regulations between April 2021 and the end of March 2022 found several violations.
“The anti-money laundering regulations must be followed. It is important to counteract the risk that the firm’s operations could be used by criminals,” Daniel Barr, the FI’s director general, said in a news release.
“Our investigation shows that Klarna has not followed the requirements on, among other things, a general risk assessment and procedures and guidelines for due diligence measures. There are therefore grounds on which to intervene against the bank.”
According to the release, the investigation found that Klarna’s risk assessment did delve into whether the company’s products and services could be used for money laundering or terrorist financing. Klarna also had no guidelines that “capture all situations for when due diligence measures should be taken for customers that use Klarna’s invoice product,” the FI said.
The regulator also noted that these violations do not warrant the issuance of a warning to Klarna or the withdrawal of its authorization.
Reached for comment by PYMNTS, a Klarna spokesperson issued a statement pointing out that the FI’s examination was a routine review of anti-money laundering regulations and not actual instances of money laundering.
“We have maintained constructive dialogue throughout this process, which is part of our commitment to a robust and secure financial environment,” the statement said.
Klarna also posted a statement on the matter on its website that argues that “all other major banks have received reprimands within the framework of the money laundering regulations.”
And as PYMNTS wrote last week, AML protections will be of increasing importance for financial institutions heading into 2025.
“AML is no longer just about keeping a banking license but about protecting customers, reputations and the ability to innovate,” that report said. “FIs that don’t invest in sophisticated AML frameworks can face the risk of falling behind not only in compliance but in their ability to serve customers effectively.”
Next year will also be a momentous one for Klarna, as the company’s long-awaited initial public offering (IPO) is expected to take place in the first half of 2025.
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