De Nederlandsche Bank imposed a EUR 722,160 administrative fine on Modulr Finance B.V. for serious deficiencies in its ongoing monitoring of clients and transactions from Jan. 1, 2023, through July 16, 2024. The electronic money institution lacked sufficient oversight of its clients, weakening its ability to identify and promptly report potential money laundering and fraud. Modulr relied heavily on client introducing partners, including crypto service providers, and conducted little or no investigation of some high risk transactions involving very large payments of unclear origin. Its transaction monitoring system did not adequately capture activity involving high risk countries, nonresidents or unusual patterns. Threshold settings also allowed large aggregate amounts split across multiple transactions to go undetected. The fine was reduced by 15% from EUR 849,600 under a simplified settlement after Modulr accepted the findings and agreed not to appeal. De Nederlandsche Bank also took account of remedial measures, including restrictions or termination of relationships with three of four relevant partners, changes to commercial strategy and risk appetite, and improvements to transaction monitoring, client risk assessment, screening and partner oversight.
De Nederlandsche Bank fines Modulr Finance EUR 722,160 for serious anti-money laundering control failures
De Nederlandsche Bank fined Modulr Finance B.V. EUR 722,160 for serious client and transaction monitoring failures between January 2023 and July 2024. Modulr accepted the findings and waived an appeal, securing a 15% reduction from the original EUR 849,600 fine, while taking steps to strengthen its anti-money laundering controls.