Worldline’s Woes Deepen as Belgium Opens Probe Into Payment Firm | Company Business News-OxBig News Network

(Bloomberg) — Worldline SA has long claimed to have cleaned up its payments business. Now, regulators and investors are testing that narrative after fresh allegations it overlooked fraud among high-risk clients.

The Brussels Public Prosecutor’s Office on Friday said it has opened a probe into Worldline’s Belgian unit following a series of media reports claiming the French firm ignored warnings and continued doing business with prohibited and high-risk clients, allowing some fraudulent transactions to persist. Sweden’s Financial Supervisory Authority said it called the company to a meeting. 

Such attention deepens the crisis at a company that serves 1.4 million businesses around the world and says it’s Europe’s biggest payments provider. Chief Executive Officer Pierre-Antoine Vacheron, who has decried the reports as an orchestrated “attack” on the company, has also said that they have negatively affected the firm’s reputation among clients. 

The company’s market value, which peaked at about €24 billion ($28.1 billion) less than four years ago, is now below €900 million after shares dropped as much as 11% on Friday. That pares some of Thursday’s 20% rebound, which itself followed a 38% drop on Wednesday.

Its struggles are the latest example of a European payments firm seemingly unable to decouple from the murky corners of the Internet that are typically shunned by large banks. And it will do little to help the payments industry shake off the stigma of Wirecard’s failure in 2020 after an accounting scandal that led to the arrest of its chief executive officer and left the German firm unable to find more than $2 billion missing from its balance sheet.

Bernstein analysts have said this week’s articles contained little substantially new since reports in 2023, when the German financial watchdog Bafin imposed restrictions on Wordline’s Payone subsidiary. But they raise significant reputational risks and could damage Worldline’s business relationships. The company works with payment networks Visa Inc. and Mastercard Inc. and many European lenders including UniCredit SpA and BNP Paribas SA. 

Its ties to Credit Agricole SA are particularly close. The French lender announced a joint venture in 2023 and subsequently acquired a 7% stake in 2024 to help stabilize its struggling payments partner. That prompted staff this week to question management about the decision.

Earlier this week, several media outlets coordinated by the European Investigative Collaborations network published reports alleging the firm moved high-risk customers — including pornographers and dating websites — across jurisdictions rather than losing their business despite warnings they were defrauding customers. 

A report by Dutch newspaper NRC alleged that Worldline in “recent years” didn’t ban lucrative customers with high fraud rates even as its risk management department pressed for stricter checks. Swedish paper Dagens Nyheter said that Worldline moved multiple high-risk clients from Worldline Belgium to its Swedish subsidiary to hide them there after credit-card provider Visa Inc. raised alarms.

“The company allegedly processed payments for companies engaged in illegal activities and for which money-laundering regulations were allegedly not respected,” the Brussels Public Prosecutor’s Office said in a statement on Friday. The probe focuses on the Belgian entity of the Worldline group, and has been entrusted to the Federal Judicial Police, officials added.

Meanwhile Sweden’s Financial Supervisory Authority on Wednesday called the company to a meeting to ask “questions about the information described” and “how the company works to ensure that their services cannot be exploited for criminal purposes,” FSA spokesperson Karin Franck said in emailed comments to Bloomberg.

Worldline said in an emailed statement that it “acknowledges the initiation of an investigation for money laundering” in Belgium and “will cooperate with the authorities.” The opening of a probe doesn’t imply the company is guilty of any wrongdoing.

While Worldline’s activities in the payment sector can be traced back to the 1970s, the firm’s modern incarnation was created as the electronic payment unit of French computer services firm Atos Plc in the 2000s. It was listed in 2014 and spent the following years consolidating the sector with a string of acquisitions, including a purchase of SIX Group’s payment business for €2.3 billion in 2018.

–With assistance from Steven Arons, Charles Daly and Abhinav Ramnarayan.

(Updates with comment in fifth paragraph)

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