Wise boss under investigation by City watchdog after tax breach

27 June 2022, 08:24

Aerial view of the London skyline
Wise boss investigation. Picture: PA

The Financial Conduct Authority has launched an inquiry into Kristo Kaarmann’s ‘regulatory obligations and standards’.

The billionaire co-founder and chief executive of Wise is being investigated by the City watchdog over his status as a so-called deliberate tax defaulter, the money transfer group has revealed.

Wise said the Financial Conduct Authority (FCA) has launched an inquiry into Kristo Kaarmann’s “regulatory obligations and standards”.

It comes after Mr Kaarmann was named last September on a list of people that HM Revenue & Customs (HMRC) has fined for deliberately defaulting on his taxes.

Wise said it had since launched its own internal probe, with help from external legal advisers, which finished at the end of last year.

It shared its findings and actions with the FCA and said Mr Kaarmann intends to fully co-operate with the FCA investigation.

The bosses of Wise
Kristo Kaarmann, right, co-founded money transfer firm Wise more than a decade ago (Wise/PA)

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.”

Wise – formerly known as TransferWise – is a regulated firm and Mr Kaarmann is an approved person under the FCA’s senior managers regime.

Mr Kaarmann was fined £365,651 by HMRC relating to an outstanding bill of £720,495 for the 2017-18 tax year.

He founded the group more than a decade ago and floated the business on the London Stock Exchange last July in what was one of the biggest flotations of the year and the largest London tech listing in history.

Mr Kaarmann still owns 19% of the firm.

By Press Association