BaFin fined the business €4.25 million in 2021 for its lax money laundering controls and placed a temporary limit on the number of new customers the bank could onboard each month, capping it at 50,000 new customers. In a rare move, the regulator also appointed a special supervisor to monitor the digital lender. BaFin urged N26 twice since 2019 to “rectify deficiencies both in IT monitoring and in customer due diligence” and to “ensure that it has the adequate personnel, technical and organisational resources to comply with its obligations under anti-money laundering law”. The bank said in a statement that it had already addressed the problems behind the BaFin fine. N26 also stated that it heavily invested in anti-money laundering measures and is fully committed to complying with all aspects of BaFin's order as quickly as possible. This came despite downsizing its workforce by cutting 71 jobs, roughly four percent of its headcount, due to a challenging macro-economic business climate. German insurance giant Allianz moved in May to sell its five percent stake in N26 at a significant discount. The insurer's venture capital arm sought to sell its stake at a valuation of $3 billion, a considerable drop from N26's previous valuation of $9 billion during its last funding round in October 2021. N26 revealed plans earlier this year to expand its crypto trading service gradually across Europe. Starting with Austria as the first market in 2022, the bank said it would provide the crypto product for customers in Germany, Switzerland, Belgium, Portugal and Ireland. The service, called N26 Crypto, is set to become available to the clients in these countries over the next months and will initially include more than 100 digital tokens. N26’s customers need to complete identity verification and eligibility checks before they can access cryptocurrency trading in the app’s ‘finances’ tab. The&nbsp;<a href="https://financefeeds.com/digital-bank-n26-raises-100m-extension-series-d-funding/" rel="noopener noreferrer nofollow">challenger bank</a>, which has more than €6 billion of deposits in customer accounts, also plans to roll out the feature to users in other European markets. It will eventually expand its token offering to almost 200 cryptocurrencies. N26 co-founder and Co-CEO, Valentin Stalf said the company wasn’t a latecomer to the crypto rush as it remains a requested and interesting asset class. However, cryptocurrencies were deep in the red throughout 2022 as investors fled the market after&nbsp;<a href="https://financefeeds.com/crypto-com-lays-off-20-of-staff-as-ftx-contagion-deepens/" rel="noopener noreferrer nofollow">FTX’s collapse</a>&nbsp;and also amid fears over higher interest rates and liquidity constraints. Behind the scenes, N26’s crypto offering is backed by&nbsp;<a href="https://financefeeds.com/italian-app-hype-taps-bitpandas-white-label-solution-for-fractional-trading-24-7/" rel="noopener noreferrer nofollow">Bitpanda</a>&nbsp;which handles trading and custody for digital assets.

BaFin keeps N26 under scrutiny amid AML concerns

FinanceFeeds

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