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ePayments Systems Ltd had to suspend online payment operations after the Financial Conduct Authority (FCA) order due to AML concerns.
The Financial Conduct Authority (FCA) has ordered ePayments Systems Ltd to suspend all its operations based on a lapse in its anti-money laundering set procedures. This action will see thousands of registered account holders with the electronic money institution frozen and not able to transact until it meets the set standards by FCA.
The news was conveyed through ePayments official website explaining to its customers regarding the downtime. The electronic payment company claims to have registered one million customers who have active accounts. However, the company has assured the users not to worry as their money is safely held in segregated bank accounts, and they will access their accounts together with their money as soon as the issue is resolved with the regulatory body.
Reasons for ePayments Suspension
According to the published statement, FCA identified a loophole in the ePayments system that criminals would exploit to launder money without being trapped by the set regulations. The regulatory body called for the payment platform to act accordingly to see it plays with the set rules and standards.
In addition to the frozen accounts, the electronic payment company will not be in a position to sign up new users for the time being. As if that is not all, the customers cannot transfer, withdraw or even deposit any cash into their accounts. This will remain so until it satisfies the regulatory body, FCA.
Currently, the payment service is working at mobilizing resources in order to complete the verification procedures in time.
ePayments Systems Background Nature
ePayments was established back in 2011 by a team of developers. It has been in existence since then and even received a certificate of clearance from FCA in 2014. Though it is not clear what led to the review, the company will not be in operation until it gets a new clearance right from the same regulatory body.
ePayments has previously been involved in a number of projects where it even once dealt with a crypto exchange called the Digital Securities Exchange (DSX). As the country stretch its powers to the limit to regulate the fast-growing cryptocurrency industry, payment platforms like ePayments are likely to feel the heat.
Due to the evolved nature of criminality and money laundering, the regulatory body in the UK is not leaving anything into chance. With the current wave of ALM review, it will see most e-commerce businesses touched and affected in their daily operation.
Previously, ePayments Systems had been authorized to issue virtual accounts with IBAN, process payments, and also deal with electronic money wallets.