Klarna has been fined Skr500 million ($50 million) by Sweden’s Financial Supervisory Authority, for anti-money laundering defects.
An investigation by the regulator during the period 1 April 2021-31 March 2022 unearthed that Klarna has been in violation of several key rules, including the requirements on a general risk assessment and customer due diligence procedures and guidelines.
The regulatory body says Klarna's general risk assessment has had "significant deficiencies", citing as an example a failure to assess how the bank's products and services could be used for money laundering or terrorist financing. In addition, the BNPL giant did not have procedures and guidelines that capture all situations for when due diligence measures should be taken for customers that use Klarna's invoice product.
Daniel Barr, director general at FI, says: "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. 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."
The scale of the problems was not sufficient to issue an official warning to Klarna or with withdraw its authorisation, he added.
All of Sweden’s largest banks have been reprimanded over money laundering compliance in recent times, with the country's oldest lender SEB hit with an Skr 4 billion penalty.
Klarna points out that the regulator did not uncover any instances of its products and services being used by money-laundering entities and that it was the largest Swedish bank — apart from state-owned SBAB — not to have been investigated until now
“We have maintained constructive dialogue throughout this process, which is part of our commitment to a robust and secure financial environment,” says a spokesperson.