- BaFin prohibits Payone GmbH from carrying out transactions for certain high-risk customers on July 26, 2023 due to money laundering risks.
- A ban on new customers was ordered to prevent abuse for money laundering.
- Compliance with AML requirements is challenging in the Web3/blockchain area.
- Serious deficits in the prevention of money laundering were identified in a special audit.
- Payone GmbH created a conspicuous high-risk portfolio due to inadequate hedging systems.
- Traders in the high-risk portfolio are often involved in fraudulent activities.
- Electronic money institutions must strictly prevent money laundering and terrorist financing.
The problem of compliance with AML (anti-money laundering) requirements is a huge one, especially in the web3/blockchain space.
The serious deficiencies identified relate to the measures Payone GmbH undertakes to assess merchants’ business models in the customer acceptance process. The deficiencies also relate to the ongoing monitoring of traders. In particular, the anomalies in the risk assessment by Payone GmbH did not result in merchants being rejected or ongoing business relationships being terminated.
Background
Payone GmbH holds a permit as an e-money institution pursuant to Section 1 (1) No. 2 of the German Payment Services Supervision Act (Zahlungsdiensteaufsichtsgesetz– ZAG). It provides payment services by accepting and settling payment transactions (acquisition business).
Electronic money institutions must ensure that they are not abused for money laundering or terrorist financing. Money laundering is the smuggling of funds from criminal sources into the legal financial and economic circuit in order to disguise their origin.
If there are increased risks of money laundering or terrorist financing, e-money institutions must comply with enhanced due diligence requirements. If the respective enhanced due diligence requirements cannot be met, the termination obligation pursuant to Section 15 (9) GwG shall apply.
