Lula says fintechs will undergo stricter scrutiny

Lula says fintechs will undergo stricter scrutiny

The global financial landscape is witnessing a significant surge in regulatory penalties, with a particular focus on fintech firms. According to a recent report by Fenergo, the value of fines issued to financial institutions in the first half of 2025 has more than quadrupled compared to the same period last year, reaching $1.23 billion [1]. This increase, driven by a 417% jump in penalties, underscores a growing trend of stringent regulatory oversight.

The report highlights that digital assets firms are increasingly in the crosshairs of regulators. The most notable penalty was imposed by the US Department of Justice (DOJ) on cryptocurrency exchange OKX, which paid over $504 million for failing to maintain an effective AML program [1]. Another cryptocurrency exchange, BitMEX, was fined more than $100 million for similar AML shortcomings, indicating a continued push from American authorities to hold digital assets institutions accountable.

North American regulators led the charge in terms of penalty value, with a total of over $1.06 billion in fines, representing a 565% surge from the same period in 2024 [1]. Meanwhile, EMEA (Europe, Middle East, and Africa) experienced a 147% increase in penalties, totaling $168.2 million [1]. In contrast, the value of penalties issued by regulators in the Asia Pacific (APAC) region fell to $3.4 million, down from $10.7 million in H1 2024 [1].

The report also notes a marked increase in fines related to sanctions compliance, with $228.8 million worth of penalties issued in H1 2025, compared to $3.7 million in H1 2024 [1]. This reflects the growing global trend of increased regulatory scrutiny around sanctions compliance, driven by geopolitical tensions and evolving sanctions regimes.

Rory Doyle, Head of Financial Crime Policy at Fenergo, commented, "These figures offer a stark warning to financial institutions across the globe, particularly those operating in the fast-growing digital assets sector, where watchdogs won’t hesitate to dole out hefty fines for AML shortcomings" [1].

The intensifying regulatory scrutiny of fintechs underscores the importance of integrating advanced financial crime technology with AI to enhance due diligence processes and strengthen compliance systems. As firms navigate more complex markets and face a shortage of skilled financial crime professionals, the adoption of sophisticated technology solutions becomes increasingly critical.

References:
[1] https://ffnews.com/newsarticle/fintech/regulatory-penalties-for-global-financial-institutions-skyrocket-417-in-h1-2025/