September 04, 2023: On Thursday, U.K. administration body stated that British financial technology firm Wise allowed an individual on the Russian sanctions list to withdraw cash. 

The user was allowed to withdraw £250 ($316.63) from a business account on Wise, according to the Office of Financial Sanctions Implementation (OFSI).

The British government imposed renewed measures and designations in response to the Russian invasion of Ukraine in February 2022, targeting a host of new banks and wealthy individuals.

According to the OFSI, Wise reported a suspected sanctions breach on June 30, 2022. The cash withdrawal was made from a Wise business account held by a company owned by an unnamed designated person, using a credit card held in their name. At the time, the company was a customer of Wise.

Wise “made complete disclosures and fully cooperated with OFSI throughout its investigation,” the OFSI said.

It’s one of a rare number of cases of publicly disclosed breaches by fintech companies. Previously, the OFSI fined U.K. payments firm TransferGo £50,000 for “making funds available to a designated person, without a license.”

Wise is one of the U.K.’s most successful fintech companies, boasting a market cap of £6.56 billion. Wise shares were down 0.5% Thursday.

Though the money involved in the sanctions violation is small, it’s a black eye for one of Britain’s fintech darlings. It highlights the industry’s ongoing struggle to prevent sanctions breaches following the Ukraine war.

The government didn’t fine Wise for the breach. The OFSI said it “does not assess the breach as sufficiently serious to impose a monetary penalty on Wise.”

Her Majesty’s Revenue and Customs previously fined wise CEO Kristo Kaarmann for failing to pay his taxes on time.

According to Financial Conduct Authority guidelines, the missed payment, which Kaarmann eventually covered, could lead to his removal as a director at the firm if financial regulators deem him unfit to run a financial services company.

Karmann is due to take three months of parental leave starting next month. Wise Chief Technology Officer Harsh Sinha will take over temporarily in his absence.