FCA Orders Epayments Systems to Suspend Operations on AML Concerns

Epayments Systems Ltd, an electronic money institution focused on online Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term for the affiliate marketing industry, has suspended its operations over lapses in its anti-money-laundering procedures.

ePayments published a short statement on its website today, giving a few details on the regulatory checks that have led to thousands of customer accounts being frozen. The update reveals that the UK's financial watchdog, the Financial Conduct Authority (FCA), is behind the whole thing.

ePayments, which claims to have signed one million users, said the watchdog had forced it to freeze all of its customer accounts and banned new account openings "until remedial action has been undertaken to the satisfaction of the FCA."

The notice further explains that this decision was taken following a regulatory review of its anti-money laundering systems and controls. That review finished, but the City watchdog was not happy with the findings that identified "a number of weaknesses which require urgent remediation to ensure that customers can enjoy a safe and secure platform."

The regulator told Epayments Systems to stop everything until it had put in place stricter checks to make sure its services weren't cleaning cash for criminals. During the course of this suspension, customers will be unable to transfer, deal, withdraw, deposit funds oruse their ePayments cards.

The troubled payment company said customers could rest assured that they are doing everything in ‎their power to resolve the current issues. Customer balances are protected in segregated accounts with major banks, and Epayments is mobilizing required resources to complete the verification project.

"We know this will be a very frustrating time for our customers. We apologise for any inconvenience caused and are working tirelessly with the FCA to ensure improvements are made and accounts can be reactivated as soon as possible. During this improvement process, we want to assure customers that their funds are being safeguarded as normal," it added.

Crypto in the background

It's not clear what has led the FCA to suspend the operation of the regulated e-money company, but the team behind ePayments was previously involved with a crypto exchange called Digital Securities Exchange (DSX).

With the UK thrashing its crypto Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term into shape, some crypto providers had no choice but to cease operations while the consequences upon related partners will likely be wide-reaching.

ePayments Systems Ltd has been an authorized electronic money institution with the UK regulator since 2015. The company is approved to issue virtual accounts with IBAN, prepaid cards, process payments, issue e-money, and handle electronic money wallets with the FCA license giving it permission to operate throughout the EU.

At the time, DSX's status as a registered agent of the FCA-regulated regulated startup was seen as an added layer of scrutiny to the crypto exchange. Users were obliged to pass KYC procedures and disclose ID information to ePayments Systems as part of anti-money laundering rules the issuer must follow.

A wave of new regulations is introducing stricter requirements for companies operating in the cryptocurrency industry, in particular measures stemming from EU's Fifth Anti-Money Laundering Directive (AMLD5).