Wise Money Laundering Investigation Meets a 20% Share-Price Fall

The Wise money laundering investigation centred on its Belgian subsidiary has knocked 20% off the WISE share price over the past year, reframing what had been a straightforward growth story into something considerably more complicated. The underlying business continues to grow at pace. The regulatory question is whether controls were adequate, and that answer is not yet in.

What the Wise Money Laundering Investigation Actually Involves

Belgian prosecutors are examining whether criminal organisations used Wise’s European accounts to move proceeds from fraud, corruption, and drug trafficking. The Bureau of Investigative Journalism reported that the probe began after Wise accounts appeared in requests for cross-border criminal assistance filed by more than 30 countries across Europe. On the transaction volume under scrutiny, one report cited more than €500 million in suspicious transactions; a separate UK outlet reported the same figure at more than £400 million. The two figures reflect different currency anchors rather than different underlying estimates.

BBC News reported that Belgian prosecutors told AFP the investigation focuses on Wise’s European operations, not its UK business, and is ‘nearing its conclusion.’ Wise responded cautiously, stating ‘no specific findings have been shared with us to date.’ The probe did not arrive entirely without warning: Banking Dive reported that European regulators placed Wise on a remediation plan in 2024, after the National Bank of Belgium found evidence of inadequate controls. That remediation was under way before the criminal investigation became public knowledge.

Money transfer platforms attract compliance scrutiny by design: they sit in the path of cross-border flows and regulators expect them to act as gatekeepers. The cross-border payments market rewards scale for a structural reason, too. The regulatory and compliance infrastructure is expensive regardless of transaction volume, and larger players can absorb that cost more readily. Wise has built a position where many of its transactions match buyers and sellers of currency directly, reducing reliance on third parties and lowering execution costs. The Wise money laundering investigation tests whether the compliance side of that infrastructure kept pace with the commercial side.

Strong Underlying Numbers, but Margin Guidance Has Come Down

For the financial year ended 31 March 2024, Wise moved £118.5bn around the world for 12.8 million customers, 29% more than the prior year, according to its preliminary results filed on the London Stock Exchange. Underlying income reached £1.2bn, up 31% year-on-year. Underlying profit before tax came in at £242m, up 226% year-on-year, producing an underlying profit before tax margin of 21%.

The quarterly trajectory has maintained that momentum. In the final quarter of last year, cross-border transactions grew 26% year-on-year and underlying income rose 24%. Customer holdings in Wise accounts increased 37% to £29bn. Full-year results now published will clarify whether the probe has begun to affect customer behaviour or whether deposits have continued to grow regardless.

The margin picture is where Wise has most clearly tempered expectations. The company’s own medium-term guidance, published alongside the FY2024 results, targets an underlying profit before tax margin of 13–16%, equivalent to an underlying adjusted EBITDA margin of 20–23%. That is a visible step down from the 21% underlying profit before tax margin delivered in FY2024, a signal that Wise intends to price aggressively and invest heavily in growth rather than harvest the efficiency gains already visible in the numbers. The company has put it plainly: it ‘remains focused on investing in long-term growth and becoming “the” network for the world’s money.’

A US Listing Adds Another Variable

The most recent annual results showed cross-border volume reach £145.2bn, a 23% increase year-on-year. Alongside those figures, Wise’s board announced plans to transfer its primary listing from the London Stock Exchange to a US stock exchange, retaining a secondary listing on the LSE, according to Crowdfund Insider. For UK investors already holding WISE, the move raises index-membership and liquidity questions worth monitoring as the Wise money laundering investigation reaches its conclusion and the primary listing structure changes.

The Belgian investigation concluding without adverse findings would remove the most immediate overhang on the share. The combination of probe resolution, the implications of the US relisting, and the trajectory of the medium-term margin target makes the next two quarters unusually information-rich for anyone still deciding how to size this position. Margin guidance and the compliance outcome are the two numbers that matter most.