Railsr Is Under Investigation In Lithuania For Money Laundering

The Bank of Lithuania is investigating Railsr’s subsidiary for “gross and systematic” money laundering and terrorism funding violations.

The central bank believes “there is reason to suspect” Railsr unit PayRNet has broken the law, according to The Telegraph.

Railsr’s European payments business, PayRNet, received an electronic money institution license from the Bank of Lithuania in 2020 to operate across the EU.

But, the central bank has obtained a court injunction to halt PayRNet from accepting new customers.

The statement adds PayRNet must “not to establish business relationships with new clients, as well as intermediaries and persons distributing and/or redeeming electronic money of this institution” until “an inspection is carried out and a judgment of the Bank of Lithuania is made about suspected breach”.

A Railsr representative told the Telegraph that the probe is “backward looking” and that it has previously offboarded users “who failed to achieve the criteria necessary”.

The company says the Bank of Lithuania just reached an interim evaluation and that it is appealing the notification.

Railsr is reportedly selling to Nigerian payments firm Flutterwave.

The company is coping with the economic slump. In October, it raised $250 million at a markdown from its $1 billion valuation a year earlier.