A group of six state regulators has ordered Wise US, Inc. to pay a $4.2 million penalty and undergo sweeping compliance reforms after identifying multiple deficiencies in the company’s anti-money laundering (AML) program.
Who’s involved: Regulators from California, Massachusetts, Minnesota, Nebraska, New York, and Texas coordinated the multi-state enforcement action, which was finalized on yesterday, through a Consent Order signed by Wise and the participating agencies.
The background: The action stems from a multistate examination conducted between January and February 2024 that reviewed Wise’s operations from July 2022 through September 2023. That exam identified violations of both federal and state laws, primarily related to Wise’s Bank Secrecy Act/AML/Countering the Financing of Terrorism (CFT) compliance program.
Violations included:
- Failure to conduct independent AML reviews on a proper schedule.
- Delays in filing Suspicious Activity Reports (SARs).
- Inaccurate or incomplete transaction monitoring data.
- Not correcting deficiencies cited in previous audits.
- Violations of the CFPB’s Remittance Transfer Rule.
The resolution: As part of the settlement, Wise agreed to:
- Pay a $4.2 million penalty split among the six participating states.
- Conduct a two-year lookback of closed customer accounts from March 2023 to March 2025 to determine whether SARs should have been filed.
- Improve customer due diligence and monitoring procedures.
- Implement a robust data integrity program to ensure accurate regulatory reporting.
- Hire a qualified, independent third party to validate and report on corrective actions quarterly.
- Submit quarterly progress reports to regulators for two years.
Not their first penalty: This is not Wise’s first regulatory stumble. Earlier this year, the Consumer Financial Protection Bureau fined Wise $2.025 million for misleading customers about fees. In 2022, Wise was fined $360,000 by Abu Dhabi’s financial regulator for AML failures. Belgium’s National Bank has also mandated a remediation program following similar findings.
What regulators said: “This week’s action is an example of state regulators acting quickly to ensure compliance and protect consumers,” said Massachusetts Commissioner of Banks Mary L. Gallagher. California DFPI Commissioner KC Mohseni added, “This action highlights the ongoing collaboration between the DFPI and other state regulators to strengthen consumer protection and uphold trust in the financial services industry.”
