FCA investigates Airbnb over financial crime controls ahead of IPO

UK: UK regulator and city watchdog, The Financial Conduct Authority [ FCA ]investigated Airbnb’s money laundering and terrorist financing controls, it was revealed in the platform’s S-1 filing last week for a proposed initial public offering [ IPO ] next month.

The FCA reviewed Airbnb because it was concerned that the UK division’s protective controls over its payment system were inadequate and left a vacuum for money launderers or terrorist financiers to exploit it by recruiting hosts and booking people. false stays.

The Authority is said to have recruited a “third-party qualified person” to review Airbnb Payments UK’s systems and controls [APUK] when the company identified “loopholes” in the way it had complied with regulations designed to protect consumer funds. Airbnb said it had offered solutions to address the issues, but the FCA had identified “certain issues with APUK’s anti-money laundering and anti-terrorist financing systems and controls”.

The home-sharing platform hopes to raise up to $3 billion through its upcoming IPO, as last week’s S-1 filing laid bare the scale of the financial impact caused by the coronavirus pandemic. Covid-19 on business. The platform posted a net loss of $697 million on revenue of $2.5 billion in the nine months to September 30, compared to a net loss of $323 million on revenue $3.7 billion over the same period a year ago.

Airbnb’s offering will be led by Morgan Stanley and Goldman Sachs, and the company’s shares are expected to trade on the Nasdaq Global Select Market under the symbol ABNB.

In August, the regulator proposed expanding its requirements to provide specific information about companies that may engage in financial crimes such as money laundering, including cryptocurrency exchanges.

At the time, the FCA estimated that only 11% of the 23,000 companies it supervised under an anti-money laundering law in 2017 had submitted relevant information about potential operating risks. The Authority wishes to cover a wider range of companies of different sizes in different sectors in order to strengthen the integrity of the UK financial system.

He also came as The Wall Street Journal reported that Airbnb’s chief trust officer, Sean Joyce, left the company after just six months last year due to a dispute over Airbnb’s supposed data-sharing practices in China.

Joyce is believed to have objected to the extent of shared data, such as phone numbers and email addresses, with the Chinese government when a traveler books a stay at any hotel operator in China. The former trust chief, who joined Airbnb in May last year, expressed concerns that the Chinese government would be able to track foreign visitors and its own citizens, the publication reported.

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