The rapid growth of the fintech industry has grabbed the attention of financial regulators all over the planet with the discussion around privacy taking priority. Europe is one of the few regions where the financial ecosystem has been taken over by digital innovation with some players trying to fly under the regulatory radar.
On Wednesday, the United Kingdom Financial Services Authority issued a warning to fintech company Lanistar for launching services without the body’s approval. The FCA stated that organizations will not be allowed to run investment scams under the pretense of nascent technologies.
Lanistar had recently made waves in the fintech space when several digital influencers posted about the fintech firm’s product on their social media handles. Some of these ‘celebrities’ even posted the new Lanistar digital card promo without clearly stating that it was an advertisement. As soon as the FCA got wind of the product, the government watchdog issued the aforementioned notice.
According to the FCA statement:
“ This firm [Lanistar] is not authorised by us and is targeting people in the UK. Based upon information we hold, we believe it is carrying on regulated activities which require authorisation. [S]ome firms act without our authorisation and some knowingly run investment scams”.
Lanistar claims to help customers better manage their facilities using their native polymorphic technology and an open banking system. The firm had earlier released statements citing FCA approval which seems to have come under fire after the latest warning. FCA officials have taken a stand that the services do not come under any audit conducted by them.
Founded by entrepreneur Gurhan Kiziloz, Lanistar has made its voice clear during the controversy. Lanistar said that they were aware of the notice and insisted that all of the company’s workings came under the legal prerogative. As of now, the company is set to contact the FCA and provide a clear answer to its user base.