As reported by the Financial Times citing multiple sources with knowledge of the incident, the money was stolen over a number of months and arose because of differences between its US and European payment systems. This discrepancy meant that some transactions that were declined were then erroneously refunded with Revolut’s own money.
The funds were taken directly from the fintech and not from customer deposits, as per the Financial Times, and despite recouping around USD 23 million in funds it still lost around USD 20 million overall.
Criminal gangs reportedly started to exploit the payments issue in early 2022 after it was first identified towards the end of 2021. Individuals were encouraged to try to make expensive purchases that would be declined and then cashed out through ATMs.
The issue supposedly came to light when a partner bank in the US alerted the fintech that it had less cash than expected, and the flaw was eventually closed around the spring of 2022.
The reported theft comes as the London-based fintech, which has been waiting for approval of a UK banking license for more than two years, is facing regulatory challenges, including concerns surrounding its 2021 financial statements.
Executives from Revolut, who have pointed to the recent turmoil in the banking industry as a reason for the current delays, said in early March 2023 that the license would be coming ‘any day now,’ according to the Financial Times.
The fintech’s independent auditor, BDO Global, also flagged concerns about Revolut’s delayed 2021 financial accounts. In a report, BDO said it was unable to independently verify three-quarters of the EUR 636 million in revenue the fintech reported in its delayed 2021 accounts.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now