Just days after the Polish Financial Supervision Authority (KNF) suspended the payment license of the local currency exchange giant Cinkciarz.pl, the company has decided to bring out the big guns. Today (Monday), the company announced its intention to file a lawsuit against the Polish Bank BPS for 500 million PLN ($125 million) and mBank S.A. for PLN 1 billion ($250 million), citing alleged banking collusion aimed at obstructing its business operations.
Cinkciarz.pl to File Two Lawsuits Tottaling PLN 1.5 Billion
The Warsaw-based fintech firm claims that Bank BPS has been systematically preventing it from executing reverse transfers for customers since September 26, under the pretext of IT problems. Cinkciarz.pl contends that these actions constitute a deliberate and ongoing effort to hinder its market access, affecting both the company and its customers.
“All key evidence of such action, including screenshots from the banking systems, has already been secured. Bank BPS's actions have seriously compromised the good name of Cinkciarz.pl,” the company commented in the official statement.
In response to these allegations, Cinkciarz.pl is calling for intervention from Poland's financial regulators. The company has indicated its intention to involve both the KNF and the Office of Competition and Consumer Protection (UOKiK) in the matter.
In a separate but related development, Conotoxia sp. z o.o., a subsidiary of Cinkciarz.pl, announced plans to sue mBank S.A. for at least PLN 1 billion. The company alleges that mBank has unlawfully obstructed its market access, including recently refusing to provide a bank guarantee despite Conotoxia having full coverage for it in its own funds.
Conotoxia claims that mBank S.A., aware that obtaining a guarantee was one of the post-inspection recommendations of the KNF, refused to provide it, citing the alleged competitiveness of Conotoxia sp. z o.o. as a domestic payment institution. The company views this decision as a flagrant violation of fair competition principles and equal treatment of businesses.
The information surfaced just a few days after the KNF announced that one of Cinkciarz.pl's subsidiaries had its payment license revoked. The regulator cited the company’s failure to ensure prudent and stable management of its payment services activities. Although Finance Magnates could not officially confirm at the time of publication that the lawsuit is related to the license revocation, there are many indications.
“As a result of the administrative investigation and based on supervisory findings, the KNF concluded that the company does not ensure prudent and stable management of the payment services business. Therefore, there is a rationale for revoking the company’s authorization to provide payment services as a domestic payment institution,” KNF commented in a statement originally published in Polish.
It's crucial to note that Conotoxia, known locally under the popular fintech brand Cinkciarz.pl, is managed through various affiliated entities. Conotoxia sp. z o.o. handles its operations as a payment institution. In parallel, Cinkciarz.pl sp. z o.o. operates as a currency exchange service provider and is an active member of SWIFT. Conotoxia Ltd, which holds a license from CySEC, operates in the FX/CFD market. Thus, while the KNF has withdrawn the license for the domestic payment institution as per its recent decision, the Cyprus-issued license for conducting CFD transactions remains unaffected and in force.
Conotoxia already has considerable experience with legal matters. Over a year ago, Finance Magnates reported on the company's triumph in a legal dispute with another local digital currency exchange, Currency One SA, that lasted ten years. This competitor had employed Conotoxia's brand as a keyword in search engine advertising to promote its services. The court ruled that Currency One must pay Conotoxia PLN 2 million as compensation, among other conditions.
