Turkish financial crime probe into firms owned by OpenPayd founder

Turkish authorities have launched a financial crime probe into two companies owned by Ozan Özerk, a Cypriot-Norwegian fintech entrepreneur who founded the Malta-based payment platform OpenPayd.

Times of Malta reported in March that OpenPayd is among several payment firms used by scammers to funnel money from would-be investors to fraudsters via sham financial trading platforms. 

There is no indication that OpenPayd is a focus of the Turkish money-laundering probe.

OpenPayd said in a statement to Times of Malta that the probe does not affect its operations or the services provided to its client, as Özerk is not involved in the board of directors or management teams of the respective OpenPayd entities.

A spokesperson for the MFSA, which regulates OpenPayd, declined to comment on specific individuals or ongoing investigations.

“However, the authority takes note of any information that may be relevant to the fitness and properness of persons linked to MFSA-licensed entities and will take appropriate action where necessary.

“The MFSA treats all allegations relating to money laundering or financial misconduct with utmost seriousness and works closely with the Financial Intelligence Analysis Unit and other domestic and international authorities to ensure that any potential risks to the integrity of the financial system are promptly and effectively addressed,” the spokesperson said.

The Turkish probe

Turkish authorities targeted individuals and companies associated with Ozan Elektronik Para Anonim Şirketi, an electronic money institution in Turkey that was allegedly “used to introduce criminal assets into the financial system under the guise of legitimate commercial activity.”

Prosecutors in Turkey say they seized assets worth €1.4 million, and orders were issued to detain 11 employees  in relation to funds derived from “illegal betting activities.”

This followed an earlier operation in which assets worth over €8 million were seized and six executives were arrested

Ozan Elektronik Para Anonim Şirketi has also been placed under a trustee.

OpenPayd founder Ozan Özerk. Photo: Ozanozerk.com

Prosecutors alleged that “transactions originating from high-risk countries such as Libya and Iraq were not blocked, and that the company’s internal control mechanisms were deliberately weakened”. 

Investigators have also implicated a second company in the alleged laundering scheme, Aveon Global Sigorta AS, which is also majority-owned by Özerk. 

“Criminal proceeds were injected into the financial system by disguising them as insurance premiums or commercial transactions,” the prosecutor’s office alleged. “It was established that these proceeds were laundered through Aveon Global Sigorta A.Ş

Özerk, who has not been personally implicated in the probe, did not respond to a request for comment.

Link to scams

In March OCCRP, Swedish Television (SVT), and 30 other media partners, including Times of Malta and Amphora Media published Scam Empire.

The journalistic investigation was based on leaked data showing payments derived from online fraud that ran through dozens of companies, including OpenPayd

In one case, a total of €2.5 million in small payments over a three-month period entered and exited the OpenPayd account of a suspected sham platform used by the scammers. 

Openpayd told reporters that it monitors all transactions to/from its clients for fraud or other financial crime red flags, including through a comprehensive fraud monitoring programme designed to combat fraud from end customers.

CurrencyRock, a Lithuanian company which ran one of the apparent sham investment platforms called Insirex, held accounts at OpenPayd.

The account appears to have been used to funnel money from the victims to their scammers.  

Internal chats found in the leak indicate the scammers were acting in tandem with Insirex, coordinating and facilitating the transfer of victims’ funds to its OpenPayd accounts 

In a separate case, Malta’s financial arbiter ordered OpenPayd to pay an elderly woman €26,000 in compensation for crediting her money to third parties without her knowledge, after she was “aggressively manipulated” by scammers.

Three other cases involving OpenPayd were dismissed by the arbiter on technical grounds, as although the scam victims had sent money to OpenPayd, they fell outside the arbiter’s jurisdiction, as these victims were not considered to be OpenPayd clients.

Financial Arbiter Alfred Mifsud has said planned legal changes aim to ensure that any licensed financial service provider involved in the suspected fraudulent payment transaction will be answerable to him.