FBI probing Evolve's sprawling fintech program, sources confirm. Mercury among programs under scrutiny for transnational money movement.

Fintech Business Weekly reports that the FBI and the U.S. Attorney’s Office for the Southern District of New York (SDNY) are actively investigating Evolve Bank & Trust’s fintech partner programs, in connection with the collapse of middleware provider Synapse and the banks Synapse worked with, particularly Evolve. According to people familiar with the matter, federal investigators have convened a grand jury and issued subpoenas, and are focused on the causes of the large shortfall in customer funds in the Synapse ecosystem as well as what various parties at Synapse and its partner banks knew and when they knew it. The probe reportedly extends beyond Synapse itself to roughly ten Evolve-linked fintech programs that enabled cross‑border or other transnational fund flows, with business banking platform Mercury and remittance app Wise specifically identified as programs drawing FBI interest. This criminal investigation comes on top of mounting regulatory scrutiny of Evolve’s “banking‑as‑a‑service” model. In June 2024, the Federal Reserve and the Arkansas State Bank Department issued a formal enforcement action against Evolve Bancorp and Evolve Bank & Trust, finding that examinations in 2023 uncovered deficient anti‑money‑laundering controls, weak risk management, and consumer‑compliance failures tied to its fintech partnerships. The Fed ordered Evolve to overhaul how it oversees fintech partners, improve Bank Secrecy Act/AML and sanctions compliance, and strengthen capital, liquidity, and operational risk management, particularly around fintech‑driven activities. Taken together, the SDNY/FBI probe and the Fed’s parallel supervisory action underscore growing legal and regulatory risk around fintech‑bank partnership models, especially programs involving complex or cross‑border money movement, and place Evolve and some of its marquee fintech clients under intensified law‑enforcement and regulatory scrutiny.

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