Crypto.com is a Visa Program Manager and they issue MCO Visa Cards to customers around the world by partnering with local card issuers — such as collaborating with Metropolitan Commercial Bank in the United States to make cards available to its customers. The business claims to have over 1 million users — of whom not all are cardholders —, and with cards being available to users in Singapore and across the United States, the firm’s eyes are now set on Europe.

“Our vision is ‘cryptocurrency in every wallet’ and to achieve that we started with a financial product the average consumer is most familiar with; the Visa card,” Kris Marszalek, Cofounder and CEO of Crypto.com, tells Business Malta. “The card is linked to a wallet where you can not only buy, exchange, sell or track cryptocurrencies, but you can also satisfy all your banking needs with products that cover savings, investments, and loans. Users can easily convert their crypto to fiat within the wallet and spend it through the MCO Visa Card anywhere Visa is accepted,” the cofounder CEO adds.

The crafted metal card sports no periodical or delivery fee at the time of the publication of the present article. The service offers up to 5% cashback on all spending — local or overseas — up to 100% purchase reimbursement for Spotify and Netflix, and up to 10% purchase rebate on Airbnb and Expedia, according to the company.

Furthermore, the business says that holders of their Visa cards are entitled to free and unlimited airport lounge access, to free ATM monthly withdrawal up to US$1,000 and can earn up to 8% per annum on their crypto investments.

“With this bridge between the fiat and crypto worlds, crypto will finally be able to make an actual impact for everyday consumers in the real world.”

“All in all, we see ourselves as a ‘crypto super app’ that has every aspect relating to crypto covered, at the same time making it easy and not intimidating to people who are new to crypto. Every product we build is designed to accelerate the world’s transition to cryptocurrency. With this bridge between the fiat and crypto worlds, crypto will finally be able to make an actual impact for everyday consumers in the real world,” adds Mr Marszalek.

Crypto with KYC

Crypto.com says it is committed to compliance, and as such, they follow know-your-customer (KYC) and anti-money laundering (AML) guidelines; highly unlikely practices for a vertical that initially used to be stigmatised for its anonymity, as well as for shadow economy having been among the early adopters of Bitcoin — the very first cryptocurrency. Users of Crypto.com services, however, are required to identify themselves upon registration, and they are verified before gaining access to their accounts.

“As a fintech company, we enter markets in a jurisdiction-by-jurisdiction process, which means that we must have a deep level of understanding of compliance with each jurisdiction’s local rules and regulations,” the cofounder CEO says.

The company has ISO27001:2013, PCI:DSS 3.2.1, Level 1 and CCSS certifications. As the Mr Marszalek says, the company takes the highest measures to ensure that customers are exposed to top-notch data security and privacy standards. At the end of the day, the company’s services are trusted with the very finances of users.

“We do understand that privacy is of utmost importance to users, which is why Crypto.com is fully General Data Protection Regulation (GDPR) compliant, and that our KYC and AML processes have been reviewed by a Big Four* firm to ensure we comply with local rules and regulations. We only retain personal data for as long as necessary, and users also have the option to request us to delete all their data if desired,” Mr Marszalek says.

Pivotal Malta

The company has an office in Malta and are currently in the process of being licensed here. “We are looking to expand our team here next year to focus on compliance and security efforts, as we are gearing up for expansion to Europe. This will be an area that can be spearheaded out of Malta,” Mr Marszelek tells BM.

Malta — that internationally markets itself as the “blockchain island” — is widely considered to have a well-established and thriving technology ecosystem. Having passed blockchain and distributed ledger technologies legislation roughly a year ago, Malta is often seen as a key player in the development of crypto and DLT solutions in the European Union, as well as globally.

“The cryptocurrency industry is going to be tightly regulated in the near future, so there’s plenty of opportunities in compliance and regulatory roles in this space. There is also a tremendous demand for cybersecurity professionals. Crypto.com is committed to working with local institutions to drive education efforts to help nurture local talent and allow it to thrive in the blockchain space,” the cofounder CEO says.

“We believe in giving people the ability to regain control of their money, data and identity via the power of blockchain technology. In order to help mass consumers gain access to crypto, we work hard to ensure our products are fully compliant in each market, which is where the KYC and AML processes come in,” Mr Marszalek underscores.

*EDITORIAL NOTE: On the query of Business Malta, Crypto.com did not disclose whether it is was Deloitte, EY, KPMG or PwC that reviewed its KYC and AML processes as the official public announcement has not yet taken place.

The post Crypto.com marries Visa card with crypto wallet, eyes Malta expansion first appeared on The Malta Business Weekly.

“Selecting the best AML solution plays a huge part in eliminating risks and protecting your business from being associated with illegal financial activity,” according to the Computime Software.

Using artificial intelligence (AI), AML software works to identify what deviates from the norm as defined by the programmed rules. As such, Computime software urges that the rules must be set up well, in order to filter out suspicious transactions.

Furthermore, the company says that if there are too few or too many alerts of possible suspicious activity based on the number of transactions, it might be a sign that the transaction monitoring system does not work as intended. Therefore, testing and tweaking the software is needed.

Nevertheless, Computime software notes that using the right technology solutions is useless on its own; the hiring of compliance officers with previous investigative and forensic accounting training, along with knowledge of the business line is crucial. It also must be accompanied by proper training to help them what to look for and how to correctly handle generated alerts.

“It is also vital to have a solid controls process, which involves superiors analysing and verifying the results of AML alerts,” the company’s blog entry underscores.

The post Computime Software sees gravity of AML monitoring first appeared on The Malta Business Weekly.

The mother company says it identified failures relating to requirements around key event notifications. Betit will pay £1.4m (€1.6m) and MT SecureTrade £700,000 (€800,000+) to responsible gambling charities pursuant to negotiated regulatory settlements, the press release says. The assessments were carried out in 2017 and 2018.

“Each company acknowledged previous weaknesses in its controls to meet social responsibility requirements early in the Gambling Commission process and immediately took steps to address the gaps in its procedures,” said Robin Reed, CEO of GiG. The CEO also praised the transparency of the process and cooperation with the UK watchdog.

“Commencing from the end of 2017, GiG has embarked on an ambitious journey to place player well-being, prevention of money laundering and sustainable business practices at the core of its operators,” Mr Reed added.

“In the last two years, we have invested heavily in automated technology such as artificial intelligence (AI) and machine learning (ML) enabling early prevention, monitoring and other reporting tools. We have also invested in people, building our compliance and player safety teams and ensuring that the necessary tools are available to them to assist in their duties of reducing the risk of business being used to further financial crime and detecting and interacting with players who may be vulnerable or at risk of problem gambling,” Mr Reed said.

The CEO ensured commitment to forming a “safe environment” for players and to “reduce gambling-related harm”. GiG says it envisages an iGaming market that is “fair and fun for all”.

Gaming Innovation Group Inc has operations in Malta and is dual-listed on the Oslo Stock Exchange under the ticker symbol GIG and on Nasdaq Stockholm under the ticker symbol GIGSEK.

The post GiG subsidiaries to pay fine after UK regulator finds shortcomings first appeared on The Malta Business Weekly.

With the delayed deadline for a Brexit deal to 31 October, uncertainties around the United Kingdom leaving the bloc have not settled yet. Nevertheless, Revolut says they prepared for any possible scenario. “If the United Kingdom and the European Union strike a deal, or if there’s a period of transitional relief, then we would continue to passport our UK-authorised permissions — via Revolut Ltd — across Europe, and there would be no action required on our customers’ side,” Mr Litsikakis tells BM.

Should the two parties be unable to reach a deal, Revolut has plans in the pipeline. Last year, Revolut Payments UAB was set up in preparation for a no-deal Brexit scenario. Revolut says that although this entity is fully operational, it is only a precautionary measure, for now. “We are pleased to confirm that this new entity is now in beta phase. As we all sit and wait to see what happens, mitigating any disruption to your services is our paramount concern. We will only switch our EEA-based customers over to this new entity in the event of a no-deal scenario,” the country manager responsible for Malta says.

Although an uncertain environment might linger on until at least the 31 October deadline, Revolut says that European customers should rest assured. “We want to assure all of our customers in Europe that we have taken the necessary preparations to ensure that they can continue to use Revolut in the same way, whatever the outcome,” the country manager underscores.

A market of ‘phenomenal’ growth

It is almost impossible to line up for payment at any POS in Malta, seeing not a single individual flashing a Revolut card. It is equally unlikely to carry out a conversation with acquaintances without bumping into Revolut card holders, or people who have at least heard about the concept. What makes the Maltese land such fertile soil for a fintech company such as Revolut?

“The Maltese market is extremely important to Revolut due to a large number of expats, migrant workers and professionals transferring money in and out of the country. So far, Revolut has proved to be incredibly popular in Malta, with over 90,000 customers signed up to date, that is around one-fifth of the population. We are signing up around 200 customers per day and only expect that to increase. Six months ago we only had around 30,000 customers in Malta, so the growth has been phenomenal,” Mr Litsikakis says.

“Revolut has proved to be incredibly popular in Malta, with over 90,000 customers signed up to date, that is around one-fifth of the population. We are signing up around 200 customers per day,”

says Revolut’s Dimitris Litsikakis.

Revolut believes its popularity lies in the “modern design” that their mobile application offers for users, as well as the fact that they issue no hidden fees and sport responsive customer service. Additional features such as instant payment notifications, automatic spending categorisation, budgeting tools, spare change saving and enhanced security further boost their prestige in the eyes of users, the company believes.

Furthermore, Revolut allows users to buy and sell a selection of cryptocurrencies, as well as to get pay-per-day travel insurance through their app. Registration for a Revolut account takes places in approximately ten minutes, and once an account is opened, users can send, spend and exchange 29 currencies in-app and spend fee-free globally in over 150 currencies, up to a threshold of £200 every month on the free plan.

Revolut’s expansion comes in a time when people appear, albeit slowly, to become more open to fintech solutions, as well as they are becoming more conscious about taking elevated control over their finances. “Fintechs are gaining in popularity across the world due to a growing shift of consumers using their phones to handle their finances and demanding more from their banks. They are no longer happy to accept rubbish exchange rates and monthly fees. Fintechs, such as Revolut, offer an alternative to the big banks,” Mr Litsikakis says.

For fuelling further growth, Revolut is planning to host more RevRally [awareness-raising promotional] events this year in Malta to encourage more consumers to open accounts with the company. “In Europe, we currently have over 4.6 million customers and are building a European Growth Machine that will help us scale at speed in every European country where Revolut’s service is currently available to further boost our customer numbers,” the country manager tells BM.

Additionally, Revolut aims to grow out of Europe. They expect to expand into a number of global markets in the coming months, with foreseen launches in the United States, Canada, Singapore, Japan, Australia and New Zealand planned in 2019.

Revolut insists on unshaken compliance

The Telegraph broke the news on 28 February that Revolut was “accused of violating basic banking rules by failing to block thousands of potentially suspicious transactions on its platform,” the report writes. Citing documents The Telegraph says had acquired, the online daily reported that Revolut switched off its system flagging suspicious transfers.

This was briefly followed by news that CFO Peter O’Higgins had resigned from his position at the company. On top of this, Revolut ran into technical issues on 1 March, affecting their app’s functionality including top-ups, exchanges and other features. Revolut’s engineers fixed the issues in a matter of minutes. Nevertheless, some Maltese customers, reading international news and swiftly jumping to unsubstantiated conclusions, ran to ATMs quickly withdrawing money, in the belief that Revolut was going down.

Nikolay Storonsky, the founding CEO of Revolut, soon after the news broke denied reports suggesting that his company would have been involved in activities raising the issue of possible “money laundering”. He also said that no connection could be found between the resignation of his company’s finance chief and the alleged “money laundering”, despite what news reports suggested.

Business Malta asked Revolut to explain the events of end-February and early-March from their perspective. “In the middle of last year, we rolled out a new sanctions screening system in parallel with our existing systems and controls. The new system required recalibration on the basis that it was creating some false positive cases (pending payments),” Mr Litsikakis tells BM about the roots of the events. During this period, Revolut says their 200-strong compliance team reviewed all payments on their platform. “The new system and subsequent recalibration had nothing to do with money laundering, and we want to make it abundantly clear that there were no breaches,” Mr Litsikakis puts his feet down.

“The new system and subsequent recalibration had nothing to do with money laundering, and we want to make it abundantly clear that there were no breaches,”

says Revolut’s Dimitris Litsikakis.

By the second week of March, the Telegraph substantially amended its article and issued a correction statement both online and in their print edition related to news they broke about Revolut.

“We would like to clarify that there never was any lapse in our anti-money laundering controls or our sanction screening process. It is also important to note that a number of articles erroneously conflated our anti-money laundering systems and our sanctions screening process,” Mr Litsikakis insists.

Business Malta was interested to learn about the magnitude of cash withdrawal in Malta at the time of unfavourable news stirring waters among its local users about the company; however, Revolut declined to disclose figures. “We do not share details of how much money is deposited in Revolut,” the company says.

The post Revolut readies intact services regardless of Brexit outcome, eyes further expansion first appeared on The Malta Business Weekly.