Prepaid Financial Services, which issues in particular PCS prepaid cards sold at tobacconists, has been fined one million euros by the French regulator for serious breaches in the internal procedures of fight against money laundering and the financing of terrorism.

With the rise of bankless accounts and cards, regulators are ensuring that their issuers do not become the Trojan horse for money laundering. Recently, the company Prepaid Financial Services (PFS) - a British electronic money institution present in France in particular via its prepaid cards sold in tobacco shops - was thus reprimanded by the Prudential Control and Resolution Authority (ACPR) with a fine of one million 'euros.

Reading the decision of the Sanctions Commission published at the end of September on the website of the French regulator, the reasons for this sanction are not lacking. The ACPR, following the checks carried out between 2017 and 2018, found, on the one hand, that PFS did not systematically verify the identity of the holders of its cards, as required by the Monetary and Financial Code. For 14 files out of a sample of 41 inspected, the British company had no information relating to the client's profession, income and resources. Another shortcoming identified by the French regulator: the inability to know the method of reloading (cash, credit card ...) used to fund prepaid cards. This, in the eyes of the ACPR, makes it difficult to monitor compliance with cash loading ceilings, fixed at 1,000  euros per month in France.

Finally, the UK e-money institution also failed in its obligations of enhanced examination and declaration of suspicions to Tracfin, the Bercy unit that investigates suspicions of fraud, money laundering or terrorist financing. At issue : reloads involving several tens of thousands of euros that have not been the subject of any follow-up by PFS.