Wise boss ‘has confidence of board’ amid tax inquiry

THE chief executive of Wise has the full backing of the money transfer company’s board despite an investigation by financial regulators into his tax affairs, an executive has insisted.

Matt Briers, Wise’s chief financial officer, said it was “business as usual” and directors continue to support Kristo Käärmann as chief executive. Wise said on Monday that the Financial Conduct Authority was investigating if Mr Käärmann had breached the standards expected of running a financial organisation when he defaulted on a £720,495 tax bill in 2017-18.

Mr Käärmann was fined £365,651 for the oversight. The FCA has the power to ban individuals from being senior managers of investment companies. “We do take this incredibly seriously. We continue to support Kristo in his role as CEO and as a leadership team, we have got a lot to focus on,” said Mr Briers, who also sits on Wise’s board.

“We’re incredibly focused on what we’re doing at Wise, the mission we’ve got ahead of us, the products we’re building. That’s what we need to do.”

He did not comment on whether any contingency plans had been made for possible sanctions against Mr Käärmann. Wise shares fell by 12.4pc to a new low yesterday, deepening a slump since it listed in London last year. The company, which allows businesses and consumers to exchange foreign currency and operate local bank accounts in different countries, has now lost two thirds of its value since its £8bn direct listing in July 2021.

Wise said full-year revenues climbed by 33pc to £559.9m as more customers used its services, attracted by lower fees. However, rising costs meant that pre-tax profits rose by 7pc, to £43.9m.

“We don’t need to raise capital. We have a healthy, profitable model. The best thing we can do is keep investing in things that are smart investments sustainably and profitably,” Mr Briers said.

Wise ordered Mr Käärmann, who has a 19pc stake in the company, to hire tax advisers after he was named on a list of tax defaulters by HMRC last year.

The company has said it is fully co-operating with the FCA investigation and had handed over the details of its own inquiry to the regulator.