FCA imposes £350k fine on Wise CEO Kristo Käärmann
The UK Financial Conduct Authority (FCA) has fined Mr Käärmann, the CEO of Wise plc and senior manager of Wise Assets UK Ltd, £350,000 for breaching a senior manager conduct rule.
In February 2021, Mr Käärmann paid a significant fine to HM Revenue & Customs (HMRC) of £365,651. He was fined for deliberately failing to notify HMRC of a capital gains tax liability after he sold shares worth £10m in 2017. In September 2021, HMRC subsequently added Mr Käärmann to their public tax defaulters list.
Between February 2021 and September 2021, these matters, including the circumstances surrounding them, were relevant to the FCA’s assessment of Mr Käärmann’s fitness and propriety. Mr Käärmann failed to appropriately consider the significance of the tax issues and notify the FCA, despite being aware of them for over seven months.
Mr Käärmann would have been fined £500,000, but he agreed to resolve these matters and so qualified for a 30% discount.
The FCA issued the fine after determining that Mr Käärmann was in breach of Senior Management Conduct Rule 4, which states: “You must disclose appropriately any information of which the FCA would reasonably expect notice.”.
As a senior manager at Wise Assets UK Ltd, the FCA expected Mr Käärmann to have self-notified of any matters that may be significant to his fitness and propriety, which included matters that may have an adverse impact on his reputation and/or that of his firms.