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Klarna has been fined $50mn and reprimanded by Sweden’s financial regulator for breaking anti-money laundering rules as the buy now, pay later pioneer gears up for a stock market listing.
The Swedish regulator said on Wednesday that between 2021 and 2022 Klarna had “significant deficiencies”, such as not having any assessments of how its services could be used for money laundering or terrorist financing.
“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,” said Daniel Barr, director-general of FI, the main Swedish financial regulator.
Klarna is considering a listing in the US in the first quarter of next year after filing confidential IPO documents last month. The Swedish group is expected to be valued at up to $20bn.
But it has come under the spotlight of regulatory authorities around the world, which are increasingly scrutinising the buy now, pay later sector. Klarna has faced censure before over how it deals with credit risks and debt collection.
FI said its investigation was not serious enough to withdraw authorisation for Klarna or issue an official warning, but sufficient to hand the company “a remark” — a lesser rebuke — and a fine of SKr500mn ($46mn).
All of Sweden’s largest banks have received fines for anti-money laundering recently, including Swedbank — the country’s oldest lender — which was ordered to pay SKr4bn.
Klarna noted on Wednesday that it was the largest Swedish bank — apart from state-owned SBAB — not to have been investigated until now and said that it faced “a complex set of regulations”.
It added that it took its responsibility to follow anti-money laundering rules “seriously”. It underscored that the FI decision was about “rule interpretation and application, and not to actual cases of money laundering”.
