FinTelegram and EFRI have put a special focus on payment services providers (PSP) facilitating investment fraud via broker scams. As a matter of fact, the boom of the Forex (FX) retail industry with the binary options fraud created an also booming illicit payment services and money laundering industry. Companies like the Israeli Pay Finder Ltd specialized on the acquisition of illicit PSPs. They are the acquirers and designers of this fraud industry.
Fact Finding Mission
The teams of FinTelegram together with the fund recovery people from EFRI have been working with some of these illegal operating Payments Services Providers like B2G GmbH (Germany), B2G s.r.o. (Czech Republic) or Rapid BO (South Africa), or Global Payment Solutions Podgorica (Montenegro). These payment service providers are part of scam broker’ schemes and their investment fraud. The PSPs we identified and talked to have disclosed contracts to us and named perpetrators.
In the course of our investigations, we have noticed that there are companies that specialize in finding and developing illegal PSPs. Like with most other activities in the scam broker industry, Israel seems to be the epicenter of a global illegal payment services industry.
How it works
One of these companies is the Israeli Pay Finder Ltd, a company that searches for and contracts with companies from a variety of industries around the world. These contracts are used, for example, to develop construction and real estate companies or IT companies into illegal PSPs. These then accept bank wired from
clients victims of illegal scam brokers such as BlueTrading, StoxMarket or XTraderFX and forward these payments to the operators of these schemes.
Within this criminal framework,
- Pay Finder refers
brokerscams as so-called “merchants” to these illegal PSPs,
- which receive payments from clients victims of broker scams to their bank accounts,
- relabel these payments (i.e. launder them),
- transfer the funds to the perpetrators, and
- in exchange for attractive commissions.
It’s a simple and highly lucrative but definitely illegal business. These illegal PSPs enable and facilitate the investment fraud via scam brokers thus participate
- in financial crime and investment fraud with retail investors as targeted victims and
- in the money laundering of stolen funds.
We learned from authorities in the
Pay Finder & Co
The illegal PSPs acquired by Pay Finder relabel the stolen client funds, lie to banks and supervisory authorities about the origin and use of the funds and enrich themselves and the beneficial owners of the scam brokers involved. Companies like Pay Finder are part of criminal cybercrime organizations and are a key element of the scam brokerage industry. Companies like Pay Finder organize the money laundering for the scam brokers and their beneficial owners.
Reading through the contracts we received it becomes evident that Pay Finder puts all legal and regulatory responsibilities on the illegal PSP. Although they must know at the time of signing the agreement that the illegal PSP is neither capable nor entitled to act in compliance with regulatory frameworks they let them sign the respective warrants. As a matter of fact, however, Pay Finder is obliged to do its own KYC/AML checks on new PSPs they obviously fail to do so.
Report Illegal Payment Services Providers
If you are aware of illegally operating payment services providers (PSP) please share your information with FinTelegram Research Team using our whistleblower system. Together we can make an impact.