The UK Financial Conduct Authority suspended Wirecard’s UK subsidiary and left thousands of people in the UK unable to access their money.
The UK regulator froze Wirecard Card Solutions’ UK lincense after the German-based parent company Wirecard AG filed for insolvency on Thursday last week.
People in UK are currently unable to access their funds held with financial apps that employ Wirecard technology.
The Newcastle-based UK subsidiary, Wirecard Card Solutions provides technology to issue prepaid cards and process payments to companies including Curve, ANNA, Pockit, Dozens, Soldo and Revolut.
The FCA stated that it has taken actions to stop Wirecard’s UK business in order to protect its customers. Last week news broke that €1.9 billion were missing from the accounts of the parent company in Germany. The FCA imposed the suspension to ensure Wirecard’s UK subsidiary did not transfer any of its own assets to Wirecard AG.
The FCA said:
We have been working closely with Wirecard UK and other authorities over the past few days to take action that protects consumers. We are continuing to do this and on 26 June, we took additional measures to require the firm to cease all regulated activities in order to further protect customer money. This now means customers money cannot be accessed.
The Anna app warned its customers that they had less than an hour to withdraw their money before all accounts of the app were frozen. Users of other fintechs received no warning.
Consequently, millions of digital banking customers, including business owners have been affected and are unable to access their money.
Anna and Pockit seem to be the most affected companies by the Wirecard’s suspension. Over 500,000 customers pockit Pockit have had their account frozen and cannot access their funds. Some of them cannot access essential benefits payments.
Curve told its customers:
Please be assured, we expect to be up and running again shortly but it may take a few days. Your money and card details held at Curve are safe and secure.
We are already well on the way to migrating away from Wirecard but have not fully completed this process. We are now working round the clock to achieve the migration as quickly as possible and therefore expect this disruption to last for only a limited period of time.
Anna and Pockit said they were working with the FCA to restore their users accounts.
The FCA stated that the customer’s money was not protected under the Financial Services Compensation Scheme (FSCS). However, as required by the Electronic Money Regulations (EMRs) and Payment Services Regulations (PSRs), customer’s money is safeguarded in separate from Wirecard’s own money in accounts with banks.
Read More:
