Kristo Käärmann, CEO of Wise, has been fined £350,000 by the Financial Conduct Authority (FCA) due to a breach of senior manager conduct rules. This action follows his failure to promptly disclose a tax default.
Background of the Tax Default and FCA Penalty
In February 2021, HM Revenue & Customs (HMRC) fined Käärmann £365,651 after he failed to report a capital gains tax liability related to a £10 million share sale in 2017. Later, in September 2021, HMRC publicly listed Käärmann as a tax defaulter, though his name was removed in 2022.
The FCA levied its fine after determining that Käärmann violated Senior Management Conduct Rule 4, which requires senior managers to promptly disclose relevant information. Käärmann had delayed seven months before informing the FCA of his tax issues.
Therese Chambers, joint executive director of enforcement and oversight at the FCA, stated, “It should have been obvious to Mr. Käärmann that he needed to tell us about these issues which were highly relevant to our assessment of his fitness and propriety.”
Wise Board’s Response and CEO’s Continued Role
Despite the FCA’s decision, Wise’s Board has affirmed Käärmann’s fitness to lead. Wise Chair David Wells remarked, “The Board conducted its own investigation and assessed that Kristo remained fit and proper… We are satisfied that the necessary remedial actions have been taken.”
For more information on the FCA’s actions, visit the FCA website.