Shares in French rival Stripe plummet after investigation into links to fraudsters

Shares in Worldline, one of Europe's collapsed by more than 35% after the publication of an international investigative journalism report called Dirty Payments. It alleges that Worldline served high-risk customers for years with minimal oversight and failed to crack down on fraudulent transactions. The company itself, whose capitalization has fallen 96% since its peak four years ago, has claimed zero tolerance for breaches. 

Shares in France's Worldline, which describes itself as Europe's largest payments operator, fell 37.6% in Paris trading after reports that it allegedly covered up fraud by some customers. The company lost about 300 million euros ($350 million) of market value as a result of the drop in quotations, reported Bloomberg. Worldline's bonds due in 2030 also collapsed - by nearly 9%.

Worldline, which processes €500 billion worth of transactions annually and had a capitalization of €1.3 billion at the close of trading on June 24, is considered a traditional player in the payment services market, Bloomberg writes. Worldline competes with relatively new companies such as Adyen and Stripe. Its shares rose more than fivefold between 2014 and 2021, bringing the company's market capitalization to nearly 24 billion euros at its peak. Since then, however, the company's shares have fallen 96%.

Worldline was the subject of a journalistic investigation Dirty Payments, which was conducted by more than 20 international media under the coordination of the European Investigative Collaborations (EIC) network. The investigation alleges that the company worked with high-risk clients and failed to effectively stop fraudulent transactions, Bloomberg writes.

Worldline responded to the investigation by declaring that it «strictly adheres to regulatory and risk prevention standards» and «maintains a 'zero tolerance' policy for non-compliance.»

The investigation, which media reports claim was based on confidential internal documents and Worldline data, alleges that the company accepted «questionable» customers across Europe - including customers linked to pornography, gambling and fraudulent «adult» dating services.

- Worldline has not blocked the accounts of profitable customers with high fraud risk in recent years, even despite pressure from its own risk management department pushing for stricter checks, confirms Dutch newspaper NRC.

- Worldline moved a number of high-risk customers from its Belgian unit to its Swedish subsidiary to hide them after payment processor Visa raised the alarm, Swedish newspaper Dagens Nyheter reported.

- Frankfurt-based Payone, a company majority owned by Worldline, failed to properly vet «dubious customers» despite legal obligations to do so, confirms German magazine Spiegel. For example, customers of dating services in Payone's portfolio have repeatedly noticed debits whose origin they could not explain. In addition, according to the German magazine, Payone allegedly allowed customers linked to pornography and illegal casinos to transfer hundreds of millions of euros without the minimum checks required by law;

This isn't the first time Worldline has run into trouble over high-risk customers. In November 2023, German financial regulator BaFin imposed severe restrictions on Payone for failing to prevent credit card fraud committed by third parties. Shortly thereafter, Worldline announced it was severing relationships with a number of customers, after which its shares plummeted.

The publication of the Dirty Payments investigation calls into question consensus forecasts for Worldline for 2025-2027, says Bloomberg Intelligence analyst Marjana Wartsaba. Current forecasts call for the company's revenue growth to go from zero to less than 3%.

This article was AI-translated and verified by a human editor