The financial regulatory body in the UK has seized £2 million in total from the payment solutions provider QPay Europe as part of some measures linked to a multi-billion bank fraud that took place in the US.
The Financial Conduct Authority (FCA) has not provided detailed information on whether it considered QPay Europe a complicit party in the US-based bank fraud, which was estimated at about $150 million, but raised a red flag about a pattern as part of which the payment solutions operator quickly cleared transactions that resulted in what the regulatory considered illegitimate operations across a number of companies.
According to reports, Fintech International Q Software WLL was the company that originally handed out the funds to QPay Europe, with the funds having reportedly being categorised as an investment. The transaction in question only came into the focus of the local financial regulator because a few years ago the payment solutions provider had filed an application to be regulated by the UK financial regulatory body.
Because of this application, QPay Europe was supposed to stick to much tougher rules regarding anti-money laundering prevention. Furthermore, the approval of a major watchdog such as the UK’s Financial Conduct Authority allows the company to access international markets and provide its services in some of the largest jurisdictions around the globe.
Suspicious Transactions Linked to Money Laundering Operations, Investigation Says
The Financial Conduct Authority spotted the suspicious monetary transactions after QPay Europe applied to fall under the regulation of the UK financial watchdog in 2020. The payment solutions operator has since withdrawn the application.
QPay Europe is not directly involved in the alleged bank fraud but the case is serious enough so that the Financial Conduct Authority had to take more serious action. According to information provided by the UK financial regulator, the illegal and high-risk financial fraud that took place on the territory of the US was worth a total of $150 million.
As part of the investigation, 4 US citizens were arrested in the District of Massachusetts under the allegations of participating in a group that was trying to deceive local credit card companies and banks so that they process illegal payments. Many of the financial transactions, especially the larger ones, were tied to online gambling operators. Allegedly, these payments were often used to cover up the actual origin of the transferred funds and make it unintelligible. Some of the transactions also led to high-risk companies, such as debt collectors and prescription drugs merchants.
According to allegations, the 4 suspects were largely involved in money laundering practices to disguise transactions to illegal or high-risk businesses as legitimate payments through Allied Wallet Inc., a Los Angeles-based company. Ahmad “Andy” Khawaja, the founder and CEO of Allied Wallet Inc., was arrested in September 2020 in Lithuania under an international arrest warrant. Reportedly, he is still in custody expecting extradition hearings.
The other three individuals, all of whom served as executives of Allied Wallet – Amy Ringler Rountree, Mohammad “Moe” Diab, and Thomas Wells – were arrested in August 2021 by US federal agents and faced charges of conspiracy to commit bank fraud and conspiracy to commit wire fraud.
- Author
Daniel Williams
