Nick Chong · 2 days ago · 2 min read
The U.S. Department of Justice (DoJ) has issued a lawsuit against digital payment facilitator Payza for laundering money in excess of $250 million.
The case comes at a time when Payza had just announced a partnership with Dash to incorporate the cryptocurrency into its stream of payment options.
As per the indictment order, Payza is being charged with running an unlicensed money processing business which allowed users to participate in illegal activities such as Ponzi schemes and child pornography.
The firm has been in operation since early 2014 and has dealt in crypto trading since its inception. Over the years, Payza has incorporated many alt-currencies into its portfolio and at the time of writing this article, the company supports transactions with Bitcoin, Ethereum, Ripple, and Dash. The company has its base in the UK but gets most of its traffic from Asia, South America, and the Middle East.
According to the DOJ, Payza and its Founders, Ferhan Patel and Firoz Patel, have been accused of running a large scale business operation without possessing the required state licenses. In addition to this, the brothers are also being booked on grounds of laundering illegally sourced money.
If convicted, the Patel brothers are looking at a minimum jail sentence of 25 years.
The lawsuit also alleges that the company had been issued with a number of “cease and desist” warnings from different states, all of whom were ignored completely. All of the aforementioned activities are being estimated to have taken place over a span of five years, during which the brothers used various US-based bank accounts to transfer money illegally throughout the country.
In regards to this case, US attorney Jesse Liu had the following remarks:
“The arrest and indictments, in this case, demonstrate that we will vigorously enforce laws meant to protect the American consumer. Money transmitting businesses are required to be registered federally and licensed in most states and jurisdictions, including the District of Columbia. Consumers should beware of those that do not follow these laws because they could be acting as a cover for other illegal activity.”
Amidst all of the accusations, Payza representatives have gone on the offensive and have posted several messages on their social media channels claiming that the company has not been involved in any wrongdoing.
As some of you may be aware of already, Payza is currently dealing with some legal matters in the United States. We cannot give any specific details at this time, but please be aware that this is an accusation and it is NOT evidence of guilt.
— Payza (@Payzaofficial) March 22, 2018
In fact, a day after the Ferhan was arrested, the company announced their partnership with Dash.
As of now, Payza’s principal online domain has been seized by the DOJ, and all transactions are being facilitated via a new website that goes by a .eu address.
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