Sanctions placed on currency exchange broker for ties to money laundering

January 12, 2017

A foreign currency exchange broker has ceased operation after coming under investigation by the U.S. Treasury. The Ottawa-based company, Accu-Rate, its president and managing director were sanctioned in September for being a “subsidiary or affiliate company” of a third-party payment processor called PacNet Services Ltd. The U.S. Treasury’s Office of Foreign Assets Control (OFAC) claims that the group “has a lengthy history of money laundering by knowingly processing payments on behalf of a wide range of mail fraud schemes that target victims in the United States and throughout the world.” One of the alleged frauds includes a $180-million psychic scheme that lured people into transferring money for items that would supposedly bring good luck, such as winning a lottery.

After the allegations were brought forward, the managing director of Accu-Rate—who was also serving as the chair of the Ottawa Chamber of Commerce at the time but has since left the position—denied them, stating she is innocent and her business has been targeted unjustly. The Accu-Rate website then went offline in December of last year, leaving behind only a message stating that its two locations “will be closed for an undetermined period of time while we work through the process of having the company and its officer removed from the OFAC list”. Because of the sanctions, individuals and businesses from the U.S. are prohibited from having business dealings with Accu-Rate or the two executives. In addition, any assets the president and managing director have that fall under U.S. jurisdiction have been frozen.

A report from OFAC alleges that the two executives and 10 other individuals act as executives or directors for companies with ties to PacNet, which is believed to have processed tens of millions in payments in 2016 alone for those responsible for over 100 cases of mail fraud. PacNet has “absolutely and categorically” rejected the claims, releasing a statement on its website stating that it has a “rigorous compliance program in place” and follows “all global standards in client due diligence”. Currently the company has stopped processing payments for any direct mail companies.

So how can you be sure your company isn’t doing business with high-risk organizations such as PacNet and Accu-Rate? Implement the CaseWare AML Compliance solution, which includes sanctions list screening and is integrated with the Thomson Reuters World-Check database, the most comprehensive and up-to-date sanctions list available. Read more about how CaseWare AML Compliance and the World-Check database can help protect your company.

 

About Andrew Simpson:

Andrew Simpson has close to two decades of experience in the information systems audit and security business; specifically data analytics, interrogation and forensics. He is a regular contributor to various auditing conferences and is acknowledged as an expert on continuous controls monitoring and revenue assurance.

Connect:  Andrew Simpson

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