Worldline plunges 40%: alleged cover-up of customer fraud devastates its stock market

Payment services company Worldline plummeted nearly 40% on the stock market on Wednesday, wiping out around €500 million in market value, after several reports suggested the company had covered up fraud.

According to Bloomberg, these reports accuse the company of allegedly covering up fraud by several of its clients, some of which were linked to pornography or gambling . This was followed by the publication of a series of articles coordinated by the European journalism network EIC (European Investigative Collaborations).

These articles claim that the company ignored warnings and continued doing business with 'prohibited' customers in recent years, resulting in more fraudulent transactions .

Following these publications, the company's shares, which describes itself as Europe's largest payment processor, closed down 38.26% after being suspended from trading on several occasions.

Despite measures to clean up its customer base, a report by the Dutch newspaper NRC alleged that Worldline has failed to expel lucrative customers with high fraud rates in recent years, even when its risk management department pushed for stricter controls.

Meanwhile, the Swedish newspaper Dagens Nyheter reported that the company moved several high-risk Worldline Belgium customers to its Swedish subsidiary to hide them there , after credit card provider Visa raised the alarm. The German magazine Spiegel also reported that Payone, majority-owned by Worldline, failed to conduct thorough vetting of "dubious customers" despite its legal obligations.

In a statement, the executive management and board of directors expressed their commitment to strict compliance with regulatory and risk prevention standards and to strictly enforcing zero tolerance rules and procedures.

The company's shares plummeted 38.26% after being suspended from trading on several occasions.

These accusations thus undermine the French firm's attempt at change , just as economic headwinds are damaging consumer confidence.

According to Bloomberg calculations, the company's stock increased fivefold between 2014 and 2021 , giving it a market capitalization of nearly $24 billion at its peak. It has plummeted 96% since then.

Worldline handles hundreds of billions of euros in transactions each year and, according to its website, its client portfolio includes banks such as UniCredit , BNP Paribas, and the retailer Subway.

Payment services company Worldline plummeted nearly 40% on the stock market on Wednesday, wiping out around €500 million in market value, after several reports suggested the company had covered up fraud.