Revolut, the international ‘neobank’ backed by Schroders Capital Global Innovation Trust (INOV ) and Molten Ventures (GROW ), lost $23m of its corporate funds last year after criminals exploited a flaw in its systems, the Financial Times has reported.

The newspaper said Revolut did not comment on the loophole which enabled fraudsters to exploit differences between European and US payment systems, meaning when certain transactions were declined Revolut would erroneously refund accounts with its own money.

Revolut recouped some of the stolen cash, but the net loss of about $20m was equivalent to almost two-thirds of its annual net profit in 2021, the peak of the technology boom when its valuation hit $33bn, the FT said.

Both Schroders Capital Global Innovation and Molten Ventures slashed their valuations of the unlisted company by 46% and 40% respectively, implying a write down to $19.8bn, to reflect the slump in valuations of publicly-quoted technology firms last year.

At the end of last year INOV, the former Woodford Patient Capital Trust that Schroders has managed since December 2019, held 2.1% of its assets in Revolut. At the time it was one of seven new investments Schroders had made since taking over the growth capital portfolio of mostly private healthcare companies. 

At a Citywire event in May, Tim Creed, lead fund manager and head of private equity investments at Schroders, reiterated that Revolut was a high-quality business with a proven long-term growth track record, given its shift from solely currency exchange to a ‘multi-product, multi-country’ banking service.

‘Revolut really can do a lot of things in a lot of geographies, which means the ceiling for Revolut is very, very high. In fact, we would argue that it’s one of Europe’s best venture-capital-backed companies,’ he said. 

The fintech has waited over two years to get a UK banking licence after the Financial Conduct Authority ordered an independent review of Revolut’s policies to combat financial crime in 2020. 

In annual results for 2021, auditor BDO warned the company’s revenues could have been ‘materially misstated’ as it was unable to verify about two thirds of revenues. 

The FT said Joel Kass, chief of staff and head of banking products for the UK, was the latest senior departure from the company, leaving three years after joining from the Bank of England. ‘He is moving on to a senior opportunity outside of the business and we wish him all the best on his next steps,’ Revolut said.

Other recent staff departures include the chief executive of its UK bank James Radford and chief financial officer Mikko Salovaara.