Alipay’s European arm has been fined €214,000 (about $250,000) by Luxembourg’s financial regulator for violations of the country’s anti-money laundering and counterterrorist financing law, reports Caixin. The regulator, known as the CSSF, disclosed the penalty against Alipay (Europe) Ltd. SA Tuesday. The decision followed an onsite inspection conducted between June 2023 and January 2024, which uncovered compliance deficiencies. The fine was formally issued in May.
The CSSF cited multiple specific failures in Alipay (Europe)’s risk controls. The company failed to report six suspected cases of money laundering linked to counterfeit goods to the Luxembourg’s Financial Intelligence Unit. Its internal procedures for handling risk alerts were inefficient, leading to substantial delays and preventing it from taking rapid restrictive measures. Regulators also found that identification documents were missing for some clients, preventing their identities from being verified.
Although the fine is modest, its designation as a penalty for “important breaches” sends a strong message and serves as a bellwether for other Chinese internet payment companies expanding into Europe.