Financial supervision: App-Bank N26: More measures against crime required

Financial supervision
App-Bank N26: More measures against crime demanded

The financial supervisory authority Bafin urges smartphone bank N26 to take a tougher approach against money laundering.

According to information published on Wednesday, the Federal Financial Supervisory Authority (Bafin) called on N26 Bank GmbH to “take appropriate internal security measures”to prevent money laundering and terrorist financing. Bafin also announced that a special representative would be appointed to monitor the situation.

Specifically, it was ordered that the N26 Bank had to eliminate deficits in computer monitoring as well as in the identification and verification of customers. In addition, the bank must ensure “adequate staffing and technical-organizational equipment to comply with its anti-money laundering obligations”.

According to N26, Bafin is calling for additional measures in the fight against digital financial crime. In recent years, N26 has already strongly promoted the expansion of prevention measures against money laundering, according to the Berlin Institute, which specializes in account management via smartphone. However, it is recognised that “more needs to be done in this area”. N26 undertakes to implement all Bafin regulations. This has no effect on customers of N26. The arrangement is unrelated to the security of the customer accounts or their deposits.

Since the beginning of the corona pandemic, criminal activities related to online trading have increased significantly worldwide, according to N26. In doing so, fraudsters manipulated third parties to open new accounts in order to use them for fraudulent purposes. The demands on banks in the fight against crime had increased. According to N26, Bafin’s claims aim, among other things, to prevent this opening of accounts and to quickly identify and block illegal transactions.

dpa