One of the founders of the company, Ferhan Patel, was arrested, while his brother, co-founder Firoz Patel, remains a fugitive. On Tuesday, the Justice Department released the charges and accused the Patel and Pazya of providing up to $ 250 million in money laundering on behalf of the Ponzi schemes and child pornography sites, among other companies.
The court's filing lists several charges: conspiracy to operate a money transfer business without a license, conspiracy to launder money and operate an unlicensed money transmission business in the District of Columbia.
While the government statements and the corresponding accusation do not mention cryptocurrencies, the firm has been operating in space for a while, offering purchases and sales of bitcoin since 2014. The company expanded to other cryptocurrencies last year, when it said in a press release that would offer exchange services for XRP and ethereum, among others, and more recently announced that it was integrating dash.
According to the US government court presentation UU., Published on Tuesday, November 3, 2016, the Patel "operated a money transmission business that operated without the necessary state licenses and knowingly transmitted funds that were derived from illegal activities."
"The Defendants ... knew that many of Payza's clients who were co-conspirators transmitted criminal proceeds through the conspirator Payza. The transmission of these funds promoted the continuation and functioning of these underlying criminal schemes, "states the presentation. In total, Payza allegedly transmitted more than $ 250 million over the course of six years.
The presentations also mention two other companies, AlertPay and EgoPay, which were said to own and manage the Patel. EgoPay froze customer funds in early 2015, and then claimed that it had been the target of an attack. The service was closed that year, as indicated in the Department of Justice document.
Court documents indicate that Ferhan Patel was arrested in Michigan and will be transported to Washington D. C. A message sent to Firoz Patel through his personal website was not returned by press time.