Trustly has stressed that it takes a warning and a penalty fee issued by Sweden’s financial supervisory authority, Finansinspektionen, “very seriously,” stating that “It is good that we now have clarity on the issue”.
The FI had disclosed that the company had not complied with key parts of the money laundering regulation, with a Trustly statement issuing an update that it has “already started to adapt its services to meet the SFSA’s updated interpretation of who should be treated as a customer in Europe”.
In its initial assessment, the financial authority said that shortcomings were identified across the group’s general risk assessment, risk classification of customers, routines and guidelines for customer knowledge, measures for customer knowledge and monitoring of customers. A warning and a penalty fee of SEK 130m (£10.18m) was issued.
Subsequently, the online banking payments provider updates that its has already addressed, or started to address, the deficiencies previously identified that are not attributable to who is to be treated as a customer.
“A key issue for the supervisory case has been Trustly Europe’s previous interpretation of the regulatory framework that end users, i.e. consumers who pay with Trustly’s service, should not be treated as customers of the company, but as customers of the merchants to whom the company’s services are provided,” a statement issued by the company reads.
“The end users who pay with Trustly have already undergone the usual customer due diligence measures carried out by their respective banks.”
Furthermore, the company adds that it has also made further moves to add further strength across risk management and compliance procedures.
Moves made here, Trustly says, includes establishing a new function in the area of AML measures, AML governance, continuously adding resources to the risk and compliance functions, and enhancing the expertise in risk and compliance matters, including a number of fresh appointments.
“It is good that we now have clarity on the issue of who the SFSA believes we should treat as a customer,” stated Johan Tjärnberg, CEO of Trustly.
“Trustly will always strive to fully comply with both the applicable regulatory framework and our own high standards, and takes the SFSA’s decision very seriously. In November 2021, we started to adapt our services based on the preliminary assessment from the SFSA regarding the end-user issue.
“We also deeply value our relationships with merchants, banks and other stakeholders and will continue to engage in an active dialogue with several of them to further explain our undertaken and planned actions in the fight against money laundering and terrorist financing, and how we ensure that Trustly remains the most trusted and secure platform for digital account-to-account transactions.
“Our market-leading technology enables a better experience for the end customer, higher conversion and lower costs for the merchant, while ensuring our service does not contribute to increased consumer debt.
“Overall, we remain well positioned in a payment services market that is rapidly transforming towards real-time payments.”