GUEST COLUMN: Payment Processors That Give Refunds Unilaterally Help Surf ‘Industry’ Live To See Another Day
Editor’s Note: This is a guest column by Gregg Evans.
Online Payment Processors, Enablers of Scams
By Greggory B. Evans, PhD
Recently it came to light that online payment processor Solid Trust Pay had decided unilaterally to refund some participants in the besieged autosurf ASD Cash Generator. In doing so, it appears STP may have violated Canadian abandoned accounts regulations, but even if by some quirk of lightly regulated Canadian processors, this policy is ripe for abuse and almost assuredly resulted in inequitable treatment.
ASD accepted payments from any number of methods, including direct deposits into bank accounts, as well as other online payment processors. In giving refunds based solely upon their own records, STP has no way of knowing if they are refunding people who are in fact otherwise in profit and made withdrawals from other processors.
If these funds had been in the United States, where ASD assets were seized last August, this money would have been pooled into a consolidated estate and, according to statements from the Justice Department, been available for refunds to losers in the scam, refunds based upon the complete records of ASD, from all sources.
Another apparent problem with STP’s refund policy is it flies in the face of traditional practice, where merchants who have funds that belong to customers who have no activity have absolute rights to their property for periods that range from 7 years in most U.S. States, up to the Canadian Policy that abandoned accounts in excess of $1,000 of 10 years at the merchant, and an additional period of up to 90 years, or indefinitely.
Accounts of more than $100 but less than $1000 are retained by merchants in Canada for 10 years, and then turned over to the Canadian Central Bank, where they are held for 30 more years.
The stated policy of Solid Trust Pay is to consider accounts “inactive†after 180 days, at which point they have in at least this case refunded some, but apparently not all, of the remaining funds in an account to the accounts from which it arrived. Their method of determining how much each participant receives is not known, and from personal knowledge of mine, some participants receive no refund at all. The reasons for this, the formula for determining refunds, and any fees STP retains for their trouble is not clear.
It’s also not exactly clear that Canada, or Ontario where STP is located, place any limit on the fees a payment processor can charge, and in fact it may be perfectly legal for them to keep the biggest share of the funds and claim it as fees. Well, except for the unclaimed funds laws, which apparently they were unaware of.
A poster here who identified herself as a representative of STP claimed that their refund policy had the approval of their attorney. I find that hard to believe, it sounds more to me like they didn’t realize that all merchants have to comply with laws that most people not versed in business practices don’t even know exist. It seems to me that a lot of what the processors do is much like the Ponzi schemes they support, made up as they go along. In the same post, the STP representative said that they try to screen their customers for legitimate businesses. This is a claim I find laughable at best.
STP and other online payment processors exist in, support, and largely make possible the easy-money Ponzi scheme culture of HYIP and autosurf programs. Without them, the “industry†could not exist. Scammers, crooks and money-launderers need a transfer system that provides irreversible payments, and they also provide some measure of invisibility for the “Admins†of online money scams.
Regulations in Canada have tightened up the invisible part, but these processors are still providing one-stop shopping for Ponzi schemes and autosurfs — and, to be sure, any number of criminals who at least have the sense to keep their activities a bit more low key. But I digress.
Let’s look at some of the customers STP has had in the past, these pillars of business who they were very careful to check and make sure they were legitimate businesses. Aside from ASD, some of their more notable clients are P2P, or Pathway to Prosperity, an Internet HYIP Ponzi whose leader is currently wanted in Canada and is a fugitive from Justice. Megalido was also an STP customer, this program popped up right around the time ASD was raided, and played to the ASD crowd as a way to recoup their losses.
Mrs. VIP/Global Marketing Solutions was another STP-supported program; they suspended payments when they said they got new owners in December, the payments were supposed to begin again in 6-8 weeks, it’s been 7 months and no sign yet of them resuming payments.
Another one I’m researching is DR Fund, a program heavily promoted by Jake Amedee and friends over at ASA Monitor, which is itself a clearing house for fraud and Ponzi schemes. I could name dozens more of these “legitimate†businesses, which I’m sure STP knows have stolen tens of millions of dollars from the public, much of it money from people who were told they were investing in real businesses, and of course, with their assurance that they screen their customers, STP is at least partly responsible for those losses. At least more so than Bank of America, named in a lawsuit lawsuit brought by some ASD victims.
Meanwhile, in a reply to a post I made asking questions about their business practices, the STP spokesperson whined about customers complaining about their policies on refunds. A quick look in the forums where Ponzi scams are promoted will reveal that when a program suspends payments for a short period of time, people begin discussing where and how they can get the payment processors to consider refunds.
Unilateral Refunds Institutionalize The Abuse
Payment processors should never give refunds directly to the people who play these scams. Legally, until a court of competent jurisdiction says otherwise, the money still belongs to the person who owns the account. Any unilateral action by the processors short-circuits the legal rights of whomever the money rightfully belongs to, whether that is the scammer, or if the authorities so determine, the victims of the scam.
Regardless, that’s not a decision the money-handlers should or even could make with any fairness. A few situations like that and it’s likely the participants will begin as a practice of making all deposits with the processor most liberal in refund history, and all withdrawals from another account. So what. Tell your customers you cannot refund their payments, the whole point of your business is irreversible payments.
Granted, your customers are for the most part people who play scams for whatever reasons, most of them have no regard for the people who lose in order for them to make profits. They engage in illegal money frauds, and now they want the protection that “real†businesses afford them. Too bad. They’re in a lousy industry for fairness or ethical business practices. The same goes for STP and the other payment processors who cater to HYIPs, autosurfs and unregistered online investing. You built your business on being the pseudo legal link in criminal enterprises.
You might, and I stress the word “might,” be following the letter of the law. Or you may be trying to stay on the legal side of the law and due to your own ignorance be falling a little short, as I suspect your refund policy does. But let me ask, if your grandmother asked about your business, and wanted the full unadulterated truth about the things you do, would you feel good telling her?
Would you be proud explaining at the family reunion how you make your money? And not the best face you can put on it, you have to imagine telling granny about every single program you accommodated that turned out to be a cheap Ponzi scheme, how many millions of dollars were lost be people who risked more than they could afford to lose, how many marriages fell apart, homes were lost, children missed meals, and how you make it possible for this industry to thrive? I suspect not.
Further, if you really can with a straight face tell me you’re actually proud of the misery you help cause, I suspect you might be a sociopath, and you might have sold your granny out for a few fees.
I’m calling you out, Solid Trust Pay. I double dog dare you to tell the crooks who utilize your services to hit the road. Hire a compliance auditor who knows how to do a little due diligence, and by that I don’t mean checking at ASA Monitor to see how many “I got paid†posts there are, but someone who knows enough about accounting, law, business and investing to look at what a company is doing and what it’s just claiming to do. I ask, no, let me rephrase that, I DEMAND you make your refund policy transparent and I’ll be checking with the Office of the Public Guardian and Trustee to find out what the exact law is on your policy and asking them to give your practices a look as well.
I also feel very strongly that you should disclose the fees you took on the refunds not only from ASD, but also MegaLido and any other funds you decided to return. Court records indicate that ASD moved several million dollars to you days before they were raided, but I see only a pittance in refunds. Granted, not every participant posts their refunds, but surely if you returned a few millions we’d see an aggregate of more than a few thousand dollars in discussions.
You enable an entire industry of crime. Eventually, the regulations will catch up to you.
Gregg,
Great article! For me, the most revealing information you noted that points to these payment processors as (at the very best) enablers of these scams is that they provide something that the scammers desperately need. The scammers desperately need a payment process wherein the payments/charges cannot be reversed. For all you strong AVG/ASD supporters out there (little joe), think of the implications……once someone knows that they have been scammed by AVG (and virtually everyone will know that soon), that person would seek all means possible to get their money back. Real legal companies like the major credit card companies and Paypal enable reversal of charges made with their cards or services. The scammers simply cannot allow that of course (it would reduce their illegal haul), so you never see major credit cards or Paypal associated with these scams. little joe, that’s why your beloved AVG Ponzi is affiliated with STP. Never mind the math and the obvious payout of money from new members to old members as flags of a scam, programs that use these payment processors are virtually certain to be scams (and Stella of STP pretty much admits to that in her post).
It was fashionable in many quarters in the early days of the ASD saga to be making patriotic pronouncements, offering up prayers for the troops overseas and celebrating the return of “our boys” while decrying the supposed un American actions of the prosecutors.
One wonders just how many of the “patriots” have given any thought to the fact both the USA and Canada (amongst others) are signators to anti terrorist and anti money laundering treaties for a very good reason.
By their own admission, ASD, and, to a lesser degree, AVG have had literally hundreds of millions of dollars pass through their hands.
Given the lack of oversight of HYIP ponzi “autosurfs” and under the radar payment processors of the type of STP, one shudders to think of the possible destinations of much of the money.
It’s not much different than credit card companies allowing the russian crime syndicate to operate processing fraudulent transactions.
http://www.dslreports.com/forum/r19620593-Ebook-websites-fraud-charges-DevbillDigitalAgePluto
The card companies get a percent.
What is their incentive to stop it?
Their percentage of loss is far outweighed by the processing charges and lack of those that complain.
Amex KNOWS it’s happening and refuses to do anything to improve their vetting and when given concrete evidence about it, still refused to even look into it.
http://www.dslreports.com/forum/r22371708-Credit-Card-Fraud-AMEX-American-Express-Charges-from-SMS-Outle
There was a huge breach at heartland processing and the banks involved refused to warn customers about it and fail to mention it as complaints of fraudulent transactions come in.
http://www.dslreports.com/forum/r21779081-Credit-Card-Fraud-Heartland-Payment-Systems-Card-Data-Hacked
BofA changed my account number for no reason (other than the heartland breach) and when I asked them why, they had no answer.
No one put money in AVGA, they bought advertising plain and simple. You wouldn’t be entitled to a refund. do you think PP gives refunds to the people who advertise on this cyberg if they get no sales which they probably don’t? Or if they just wish they had spent their money elsewhere? Guess not eh boy.
Sorry missed the A in CYBERRAG then again I’ve lost my A before but I know how to get it back.
Joe,
Take the “bought advertising” crap elsewhere. You’re not fooling anyone. Everyone got into that junk scam AVG to “recoup losses from ASD” Advertising was the furthest thing from anyones mind.
18,000 people didn’t come in to recoup losses from ASD and if there were some that did and they were able to recoup their losses, how wonderful is that? Also, guess what Skippy, I’ve sold my product from the ad rotator and I wasn’t even trying that hard, I was mostly there for the revenue share.
joe: Hate to be the one to tell you this, but you just confirmed what everyone has known for since the inception of AVG, that you were “investing” in AVG, not purchasing advertising. But thanks for confirming it for those who still were not sure.
I would not get too excited about making “a” sale by accident. One sale hardly constitutes AVG being this great advertising company. After all they said they were not an investment but an advertising company. You must remember to keep with the company mantra, or they will get upset with you calling it an investment.
who said it was only one sale? I also never used the word invest, you did. When I put my product on there it was a legitimate one and still is. I didnt change the company mantra you did. You can try to put words in my mouth all you want but that’s all it is. You know what the really good part about selling my product? Now they trust me and I can get them in to all of these other scams. It kind of bothers me to have a good legitimate product but you do what you have to do to get them in the fold.
Gregg, it is great to see you raising this issue. The existance of these many almost unregulated and offshore payment processors is one of the biggest single reasons that the online networking marketing scams can be perpetuated.
One of the biggest difficulties in stopping these scammy aspect of most of the network marketing type businesses is the total lack of effective legislation and the relative ease with which they can be financed. (I say relative ease, as AVGA seems to be having a hard time on that score. lol) Even though the legitimate credit card companies can’t be easily used and Paypal will not deal with them, there are many uncontrolled offshore payment processors who are only too happy to take the money and look the other way.
In some cases, as with STP, their User Agreements have so many disclaimers that they appear to take little or no responsibility for their customers money at all. In other cases, notably Alert Pay, they charge higher fees for “Restricted Activities” including “multi-level marketing (MLM) and pyramid selling services, matrix programs, or online income opportunity programs “, and whilst money laundering is expressly forbidden, the acceptance of pyramid selling as a Restricted Activity is the acceptance of an illegal activity. The conditions of the many others vary from the sublime to the ridiculous, but they all have in common the enabling of busineses that would have a hard time processing money elsewhere.
It is high time that the governments that give homes to these quasi financial institutions take a very close look at what they are doing. It is also time for the processors themselves to decide whether they wish to clean up their acts and serve a useful purpose (providfing fast online money transactions for goods and services, like paypal) or whether they are going to continue to knowingly support online crime. There is no question that they are unaware of the businesses that belong to their customers, especially when millions pass through their accounts from these so called busineses.
If they are not willing to stop enabling and facilitating cybercrime, then it is time they were all called to account. As STP is the processor involved in the AVGA/ASD discussion, I hope they meet Gregg’s challenge and provide some much needed explanations on their treatment of ASD funds and why they are dealing with AVGA.
If MLM’s are restricted activity then Amway is in violation, oh my goodness so is Avon, who else?
joe:
Amway and Avon and their distributors can use any bank, credit card company or payment processor they wish as they are legal. You may not like them but the courts have ruled in their favor.
ASD, AVGA, PIPS, Mrs VIP, 12DP, etc don’t have those options.
Tell me some legitimate companies who only use these payment processors. Companies like Amway and Avon do not use these companies at all. I do not know of even one MLM that uses them.
I should say I do not know of even one LEGITIMATE MLM that uses them.
I believe that Avon forbids it’s distributors from accepting payment through non reversible processors, and would not be surprised if Amyway and indeed most legitimate MLM businesses do. Without giving my own opinion of that industry, they generally are close enough to the legal line on other things that they want to stay well clear of it where they can, such as using shady vendors for payments.
joe: You can try to play stupid or dumb all you want, but when you said you were AVG for the “revenue share” you were investing and you know it. You can’t share in the revenue unless you are in “investor.” No-one is buying your story anymore.
joe,
Glad to see you continue to be on a higher communications plane that ever, invoking a derogatory racial epithat when addressing me.
Back on point, even if the ASD folks did buy advertising, when the government shut it down, the people didn’t even get their advertizing, and as such could getthe chargeback from a real payment processor like Mastercard because ASD did not deliver the advertising that their customers purchased. Same thing will happen to AVG — AVG’s terminal you know, and everyone else knows it too. The people who are dumb enough at this juncture to think they bought advertising aren’t going to get their advertising, nor chargebacks from a legit payment processor.
No one put money in AVGA, they bought advertising plain and simple. You wouldn’t be entitled to a refund. do you think PP gives refunds to the people who advertise on this cyberg if they get no sales which they probably don’t? Or if they just wish they had spent their money elsewhere? Guess not eh boy.
Without giving my own opinion of that industry, they generally are close enough to the legal line on other things that they want to stay well clear of it where they can, such as using shady vendors for payments.
AMEN!
Sicilian,
Actually the most important purpose of little joe’s posts has been fulfilled. He has already admitted that AVG is illegal and that he doesn’t care, and he’s admitted that he is a serial criminal scammer. He’s an irrelevant bit player though, so won’t wind up in jail. What he has done is he has revealed his true nature to anyone who cares to read this blog, and so his statements in favor of AVG and its business model and legaility carry the appropriate weight of his criminal endorsement of a criminal enterprise with the people who might be undecided.
….but you are right…..cogent arguments elude him, so he needs to rely on the same old drivel, nothing new, no data or facts, and sprinkles in blatantly insulting language. Do you know if there is a phrase book for scammers? Seems like we hear the same tired lines…..
DB,
joe doesn’t like them because you actually do have to work in order to make money at Amway and Avon.
joe,
I don’t get it. This is a serious discussion (or was until you started posting bovine manure) about payment processors who enable and facilitate illegal and quasi legal internet businesses.
What on earth have payment systems for real products, like makeup and cleaning fluids got to do with payment systems for unregistered securities?
If you are “the public face of AVGA”, then it is clearly not a class act! Do you really believe half the carp that you post, because if you do, you have to understand that noone else reading it does
joe doesn’t like them because you actually do have to work in order to make money at Amway and Avon.
And with Avon at least, a large part of their revenue comes from direct sales of product. That has to be true – i didnt even know it was an MLM and I have been buying their stuff for years. When I discovered it was an MLM, I realised that’s the reason it costs so much! lol But that doedsnt change the fact that it has customers for its product and not its MLM. (see ASD’s expert witness Gerry Nehra’s statement on what it takes for an MLM to be legitimate)
Getting back on topic, sorry for the brief interlude off topic, Gregg’s article is right on the money and outstanding.
One of my favorite stories about STP happened several years ago. Seems someone sent STP $25,000, but they claim it was lost. Now you would expect a “legitimate” company would immediately do everything in its power to find it, or make good right? Not STP. They told them it was their fault, they weren’t liable, too bad, and STP was the one who lost it. End of story.
As Gregg said, the KYC rule is a joke to STP, and they could care less who they do business with as long as they earn their fees. Hopefully with the new FISA rules, and if the Canadian’s actually enforce it, it might shut them down.
Gregg,
As it relates to STP, do you or anyone else know who their bank is? While Stella and company take more than a few shortcuts in their business practices, I doubt they keep the money in a mattress.
If anyone has had a dealing with them where an electronic transfer was made from STP to a US financial institution, the payment would have actually come from STP’s bank to the Federal Reserve then to the destination financial institution. Obtaining that info isn’t too difficult, since it’s not confidential or proprietary; you just need the dates of the transaction, and someone with access to the check processing records. I had a delay in a PayPal transaction, and it took 2 people about 5 minutes to pull all of the info for me. Likewise with a check or draft coming from STP; it’ll have the identifying info for the issuing institution. Since all instruments are filmed and destroyed now, you can get a copy of the front and back of anything received from STP right in your own online bank account.
My reason for bringing this up is simple: The chair, board and execs of banks hate receiving any type of negative commentary and publicity. Say the Bank of Montreal is behind STP (that’s just an example) – if all of their board and execs began to receive emails outlining in detail the money-handling processes used by STP and other fringe payment processors, they could perhaps rethink their own support of STP. In an (not so) indirect manner, these institutions are enabling STP and others to exist. If they could be persuaded to rethink their own policies and drop them, it would force STP and others offshore, and drive their own cost of doing business, as well as risk, through the roof. It probably won’t kill the STP’s of the world off, but it certainly would cripple them…
Jerry
Racial epithat? What the hell are you talking about? Whatever else I am I’m not a racist and I have no idea how you can take anything I said in a racial way. Don’t even try that bullshit on me. That’s one of those chickenshit last resort things when you don’t have a real answer and I might add quite a heavy accusation which I find insulting. Why don’t you just say something about my mother?
The ironic thing is that with Ponzi’s, it’s been estimated that 92% of people lose money, with MLM it’s in the 98% – 99% range. The difference is that both have been vetted by the Supreme Court, one has been found to be legal, the other not.
Now you really do have a good point. Every processor has to have a bank. Maybe it’s time that their banks look into WHO their Oh So Profitable clients are.
Whatever it takes to stop all this online scamming carp.
Great Article Gregg!!
What he is talking about is your comment “eh boy.” In many circles this is a racial epithat, as well as derogatroy. While you may not have meant it that way, it certainly could be interpreted that way.
joe,
Perhaps you did not mean in in the way I interpreted it. However, to quote, “eh boy?”
Oh, and I do have real answers. To be fair, you do too, as in “I don’t care if AVG is illegal”, to paraphrase.
Thx Lynn,
Exactly right in my circles. It seemed so obvious…..of course, so does the Ponzi nature and unsustainability of AVG……
Simply amazing Gregg!
One of the problems with some of these processors, not sure if it applies to STP, is that they themselves don’t accept regualr payments to fund your account. You have to go to an “exchanger” who sells you a certain amount of the e-currency, and this effectively blocks most people from tracing the funds any further. Especially if the exchanger is in another offshore jurisdiction. A seasoned investigator may be able to trace it, with a few source documents a good accountant could, but as far as most of the people who deal with them, the exchangers add another layer of invisible transasactions that make it very hard to trace.
I have an STP account. I put $10 into Megalido to do some digging, and though STP claims to have refunded people who lost, I didn’t get anything, so that is the “personal knowledge” I have mentioned about their refund process being less than tranparent.
Just went and checked. STP accounts can be funded from US and Canadian bank accounts and they accept wire transfers amongst other methods.
So……
Solid Trust Pay answers some of the questions raised here:
http://hyipblog.nobshyip.net/2007/04/03/solidpaytrust-legal-information/
Essentially they say that they comply with Canadian law. I’m not sure if being a payment processor for obvious ponzi schemes is legal in any country.
Unlicensed money transmitters are not to be trusted. What are they doing with people’s money? This pair were skipping the country with their ill-gotten gains.:
http://www.ice.gov/pi/nr/0811/081113philadelphia.htm
http://www.ice.gov/pi/nr/0904/090423philadelphia.htm
This quote from the blog was amusing, under the circumstances
……We battle hackers, phisphing emails, fraudsters and other criminal activity constantly. I’m sure I have more white hair now than I did a year ago :-) And it’s not a question of if, but a question of when and how. We are not daunted by such attempts, however, and continue to discover new and innovative ways to thwart them………etc
Kind regards,
Stella and Marc Hiemstra.
I wonder what kind of moves they are taking to thwart AVGA and other similar clients from breaking the law.
So Stella, how pray tell, do you and Marc plan to deal with encountering this legal item?
§ 1956. Laundering of monetary instruments
(a)
(1) Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity—
(A)
(i) with the intent to promote the carrying on of specified unlawful activity; or
(ii) with intent to engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code of 1986; or
(B) knowing that the transaction is designed in whole or in part—
(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or
(ii) to avoid a transaction reporting requirement under State or Federal law,
shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both. For purposes of this paragraph, a financial transaction shall be considered to be one involving the proceeds of specified unlawful activity if it is part of a set of parallel or dependent transactions, any one of which involves the proceeds of specified unlawful activity, and all of which are part of a single plan or arrangement.
(2) Whoever transports, transmits, or transfers, or attempts to transport, transmit, or transfer a monetary instrument or funds from a place in the United States to or through a place outside the United States or to a place in the United States from or through a place outside the United States—
(A) with the intent to promote the carrying on of specified unlawful activity; or
(B) knowing that the monetary instrument or funds involved in the transportation, transmission, or transfer represent the proceeds of some form of unlawful activity and knowing that such transportation, transmission, or transfer is designed in whole or in part—
(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or
(ii) to avoid a transaction reporting requirement under State or Federal law,
shall be sentenced to a fine of not more than $500,000 or twice the value of the monetary instrument or funds involved in the transportation, transmission, or transfer, whichever is greater, or imprisonment for not more than twenty years, or both. For the purpose of the offense described in subparagraph (B), the defendant’s knowledge may be established by proof that a law enforcement officer represented the matter specified in subparagraph (B) as true, and the defendant’s subsequent statements or actions indicate that the defendant believed such representations to be true.
(3) Whoever, with the intent—
(A) to promote the carrying on of specified unlawful activity;
(B) to conceal or disguise the nature, location, source, ownership, or control of property believed to be the proceeds of specified unlawful activity; or
(C) to avoid a transaction reporting requirement under State or Federal law,
conducts or attempts to conduct a financial transaction involving property represented to be the proceeds of specified unlawful activity, or property used to conduct or facilitate specified unlawful activity, shall be fined under this title or imprisoned for not more than 20 years, or both. For purposes of this paragraph and paragraph (2), the term “represented†means any representation made by a law enforcement officer or by another person at the direction of, or with the approval of, a Federal official authorized to investigate or prosecute violations of this section.
(b) Penalties.—
(1) In general.— Whoever conducts or attempts to conduct a transaction described in subsection (a)(1) or (a)(3), or section 1957, or a transportation, transmission, or transfer described in subsection (a)(2), is liable to the United States for a civil penalty of not more than the greater of—
(A) the value of the property, funds, or monetary instruments involved in the transaction; or
(B) $10,000.
(2) Jurisdiction over foreign persons.— For purposes of adjudicating an action filed or enforcing a penalty ordered under this section, the district courts shall have jurisdiction over any foreign person, including any financial institution authorized under the laws of a foreign country, against whom the action is brought, if service of process upon the foreign person is made under the Federal Rules of Civil Procedure or the laws of the country in which the foreign person is found, and—
(A) the foreign person commits an offense under subsection (a) involving a financial transaction that occurs in whole or in part in the United States;
(B) the foreign person converts, to his or her own use, property in which the United States has an ownership interest by virtue of the entry of an order of forfeiture by a court of the United States; or
(C) the foreign person is a financial institution that maintains a bank account at a financial institution in the United States.
(3) Court authority over assets.— A court may issue a pretrial restraining order or take any other action necessary to ensure that any bank account or other property held by the defendant in the United States is available to satisfy a judgment under this section.
(4) Federal receiver.—
(A) In general.— A court may appoint a Federal Receiver, in accordance with subparagraph (B) of this paragraph, to collect, marshal, and take custody, control, and possession of all assets of the defendant, wherever located, to satisfy a civil judgment under this subsection, a forfeiture judgment under section 981 or 982, or a criminal sentence under section 1957 or subsection (a) of this section, including an order of restitution to any victim of a specified unlawful activity.
(B) Appointment and authority.— A Federal Receiver described in subparagraph (A)—
(i) may be appointed upon application of a Federal prosecutor or a Federal or State regulator, by the court having jurisdiction over the defendant in the case;
(ii) shall be an officer of the court, and the powers of the Federal Receiver shall include the powers set out in section 754 of title 28, United States Code; and
(iii) shall have standing equivalent to that of a Federal prosecutor for the purpose of submitting requests to obtain information regarding the assets of the defendant—
(I) from the Financial Crimes Enforcement Network of the Department of the Treasury; or
(II) from a foreign country pursuant to a mutual legal assistance treaty, multilateral agreement, or other arrangement for international law enforcement assistance, provided that such requests are in accordance with the policies and procedures of the Attorney General.
(c) As used in this section—
(1) the term “knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity†means that the person knew the property involved in the transaction represented proceeds from some form, though not necessarily which form, of activity that constitutes a felony under State, Federal, or foreign law, regardless of whether or not such activity is specified in paragraph (7);
(2) the term “conducts†includes initiating, concluding, or participating in initiating, or concluding a transaction;
(3) the term “transaction†includes a purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition, and with respect to a financial institution includes a deposit, withdrawal, transfer between accounts, exchange of currency, loan, extension of credit, purchase or sale of any stock, bond, certificate of deposit, or other monetary instrument, use of a safe deposit box, or any other payment, transfer, or delivery by, through, or to a financial institution, by whatever means effected;
(4) the term “financial transaction†means
(A) a transaction which in any way or degree affects interstate or foreign commerce
(i) involving the movement of funds by wire or other means or
(ii) involving one or more monetary instruments, or
(iii) involving the transfer of title to any real property, vehicle, vessel, or aircraft, or
(B) a transaction involving the use of a financial institution which is engaged in, or the activities of which affect, interstate or foreign commerce in any way or degree;
(5) the term “monetary instruments†means
(i) coin or currency of the United States or of any other country, travelers’ checks, personal checks, bank checks, and money orders, or
(ii) investment securities or negotiable instruments, in bearer form or otherwise in such form that title thereto passes upon delivery;
(6) the term “financial institution†includes—
(A) any financial institution, as defined in section 5312 (a)(2) of title 31, United States Code, or the regulations promulgated thereunder; and
(B) any foreign bank, as defined in section 1 of the International Banking Act of 1978 (12 U.S.C. 3101);
(7) the term “specified unlawful activity†means—
(A) any act or activity constituting an offense listed in section 1961 (1) of this title except an act which is indictable under subchapter II of chapter 53 of title 31;
(B) with respect to a financial transaction occurring in whole or in part in the United States, an offense against a foreign nation involving—
(i) the manufacture, importation, sale, or distribution of a controlled substance (as such term is defined for the purposes of the Controlled Substances Act);
(ii) murder, kidnapping, robbery, extortion, destruction of property by means of explosive or fire, or a crime of violence (as defined in section 16);
(iii) fraud, or any scheme or attempt to defraud, by or against a foreign bank (as defined in paragraph 7 of section 1(b) of the International Banking Act of 1978)); [1]
(iv) bribery of a public official, or the misappropriation, theft, or embezzlement of public funds by or for the benefit of a public official;
(v) smuggling or export control violations involving—
(I) an item controlled on the United States Munitions List established under section 38 of the Arms Export Control Act (22 U.S.C. 2778); or
(II) an item controlled under regulations under the Export Administration Regulations (15 C.F.R. Parts 730–774);
(vi) an offense with respect to which the United States would be obligated by a multilateral treaty, either to extradite the alleged offender or to submit the case for prosecution, if the offender were found within the territory of the United States; or
(vii) trafficking in persons, selling or buying of children, sexual exploitation of children, or transporting, recruiting or harboring a person, including a child, for commercial sex acts;
(C) any act or acts constituting a continuing criminal enterprise, as that term is defined in section 408 of the Controlled Substances Act (21 U.S.C. 848);
(D) an offense under section 32 (relating to the destruction of aircraft), section 37 (relating to violence at international airports), section 115 (relating to influencing, impeding, or retaliating against a Federal official by threatening or injuring a family member), section 152 (relating to concealment of assets; false oaths and claims; bribery), section 175c (relating to the variola virus), section 215 (relating to commissions or gifts for procuring loans), section 351 (relating to congressional or Cabinet officer assassination), any of sections 500 through 503 (relating to certain counterfeiting offenses), section 513 (relating to securities of States and private entities), section 541 (relating to goods falsely classified), section 542 (relating to entry of goods by means of false statements), section 545 (relating to smuggling goods into the United States), section 549 (relating to removing goods from Customs custody), section 554 (relating to smuggling goods from the United States), section 641 (relating to public money, property, or records), section 656 (relating to theft, embezzlement, or misapplication by bank officer or employee), section 657 (relating to lending, credit, and insurance institutions), section 658 (relating to property mortgaged or pledged to farm credit agencies), section 666 (relating to theft or bribery concerning programs receiving Federal funds), section 793, 794, or 798 (relating to espionage), section 831 (relating to prohibited transactions involving nuclear materials), section 844 (f) or (i) (relating to destruction by explosives or fire of Government property or property affecting interstate or foreign commerce), section 875 (relating to interstate communications), section 922 (l) (relating to the unlawful importation of firearms), section 924 (n) (relating to firearms trafficking), section 956 (relating to conspiracy to kill, kidnap, maim, or injure certain property in a foreign country), section 1005 (relating to fraudulent bank entries), 1006 [2] (relating to fraudulent Federal credit institution entries), 1007 [2] (relating to Federal Deposit Insurance transactions), 1014 [2] (relating to fraudulent loan or credit applications), section 1030 (relating to computer fraud and abuse), 1032 [2] (relating to concealment of assets from conservator, receiver, or liquidating agent of financial institution), section 1111 (relating to murder), section 1114 (relating to murder of United States law enforcement officials), section 1116 (relating to murder of foreign officials, official guests, or internationally protected persons), section 1201 (relating to kidnaping), section 1203 (relating to hostage taking), section 1361 (relating to willful injury of Government property), section 1363 (relating to destruction of property within the special maritime and territorial jurisdiction), section 1708 (theft from the mail), section 1751 (relating to Presidential assassination), section 2113 or 2114 (relating to bank and postal robbery and theft), section 2280 (relating to violence against maritime navigation), section 2281 (relating to violence against maritime fixed platforms), section 2319 (relating to copyright infringement), section 2320 (relating to trafficking in counterfeit goods and services), section 2332 (relating to terrorist acts abroad against United States nationals), section 2332a (relating to use of weapons of mass destruction), section 2332b (relating to international terrorist acts transcending national boundaries), section 2332g (relating to missile systems designed to destroy aircraft), section 2332h (relating to radiological dispersal devices), section 2339A or 2339B (relating to providing material support to terrorists), section 2339C (relating to financing of terrorism), or section 2339D (relating to receiving military-type training from a foreign terrorist organization) of this title, section 46502 of title 49, United States Code, a felony violation of the Chemical Diversion and Trafficking Act of 1988 (relating to precursor and essential chemicals), section 590 of the Tariff Act of 1930 (19 U.S.C. 1590) (relating to aviation smuggling), section 422 of the Controlled Substances Act (relating to transportation of drug paraphernalia), section 38 (c) (relating to criminal violations) of the Arms Export Control Act, section 11 (relating to violations) of the Export Administration Act of 1979, section 206 (relating to penalties) of the International Emergency Economic Powers Act, section 16 (relating to offenses and punishment) of the Trading with the Enemy Act, any felony violation of section 15 of the Food Stamp Act of 1977 (relating to food stamp fraud) involving a quantity of coupons having a value of not less than $5,000, any violation of section 543(a)(1) of the Housing Act of 1949 (relating to equity skimming), any felony violation of the Foreign Agents Registration Act of 1938, any felony violation of the Foreign Corrupt Practices Act, or section 92 of the Atomic Energy Act of 1954 (42 U.S.C. 2122) (relating to prohibitions governing atomic weapons) [3] environmental crimes
(E) a felony violation of the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.), the Ocean Dumping Act (33 U.S.C. 1401 et seq.), the Act to Prevent Pollution from Ships (33 U.S.C. 1901 et seq.), the Safe Drinking Water Act (42 U.S.C. 300f et seq.), or the Resources Conservation and Recovery Act (42 U.S.C. 6901 et seq.); or
(F) any act or activity constituting an offense involving a Federal health care offense;
(8) the term “State†includes a State of the United States, the District of Columbia, and any commonwealth, territory, or possession of the United States.
(d) Nothing in this section shall supersede any provision of Federal, State, or other law imposing criminal penalties or affording civil remedies in addition to those provided for in this section.
(e) Violations of this section may be investigated by such components of the Department of Justice as the Attorney General may direct, and by such components of the Department of the Treasury as the Secretary of the Treasury may direct, as appropriate, and, with respect to offenses over which the Department of Homeland Security has jurisdiction, by such components of the Department of Homeland Security as the Secretary of Homeland Security may direct, and, with respect to offenses over which the United States Postal Service has jurisdiction, by the Postal Service. Such authority of the Secretary of the Treasury, the Secretary of Homeland Security, and the Postal Service shall be exercised in accordance with an agreement which shall be entered into by the Secretary of the Treasury, the Secretary of Homeland Security, the Postal Service, and the Attorney General. Violations of this section involving offenses described in paragraph (c)(7)(E) may be investigated by such components of the Department of Justice as the Attorney General may direct, and the National Enforcement Investigations Center of the Environmental Protection Agency.
(f) There is extraterritorial jurisdiction over the conduct prohibited by this section if—
(1) the conduct is by a United States citizen or, in the case of a non-United States citizen, the conduct occurs in part in the United States; and
(2) the transaction or series of related transactions involves funds or monetary instruments of a value exceeding $10,000.
(g) Notice of Conviction of Financial Institutions.— If any financial institution or any officer, director, or employee of any financial institution has been found guilty of an offense under this section, section 1957 or 1960 of this title, or section 5322 or 5324 of title 31, the Attorney General shall provide written notice of such fact to the appropriate regulatory agency for the financial institution.
(h) Any person who conspires to commit any offense defined in this section or section 1957 shall be subject to the same penalties as those prescribed for the offense the commission of which was the object of the conspiracy.
(i) Venue.—
(1) Except as provided in paragraph (2), a prosecution for an offense under this section or section 1957 may be brought in—
(A) any district in which the financial or monetary transaction is conducted; or
(B) any district where a prosecution for the underlying specified unlawful activity could be brought, if the defendant participated in the transfer of the proceeds of the specified unlawful activity from that district to the district where the financial or monetary transaction is conducted.
(2) A prosecution for an attempt or conspiracy offense under this section or section 1957 may be brought in the district where venue would lie for the completed offense under paragraph (1), or in any other district where an act in furtherance of the attempt or conspiracy took place.
(3) For purposes of this section, a transfer of funds from 1 place to another, by wire or any other means, shall constitute a single, continuing transaction. Any person who conducts (as that term is defined in subsection (c)(2)) any portion of the transaction may be charged in any district in which the transaction takes place.
Let’s not forget, STP, solidtrustpay is in CLEAR violation of CANADA’s AML policies. The new law Bill C-25 requires specific steps for verification, and STP does not adhere to them. STP is a shameful company. FINTRAC needs to step in.
[…] ********** This July 9, 2009, post by guest columnist Gregg Evans also scored very well overall for the year, finishing in the Top 30: GUEST COLUMN: Payment Processors That Give Refunds Unilaterally Help Surf ‘Industry’ Live To See… […]
[…] “Whose Lawyer Is This Anyway,” an Aug. 29 PP Blog guest column by Gregg Evans. See July 9, 2009, guest column by Evans that raised questions about how the SolidTrustPay payment processor was enabling fraud […]
[…] For an in depth look at payment processors/enablers, check out this PatrickPretty article, by Gregg Evans, PhD. […]
[…] In 2009, while the ASD case was still in the courts, some members of AdSurfDaily received mysterious “final refunds” from SolidTrustPay through an STP-connected email address of oceannamusic@xplornet.com. The purported pro rata refunds led to questions about whether some ASD members were benefiting at the expense of others while the case still was in the U.S. courts and whether ASD actually had money in SolidTrustPay under the name of a different company or a user other than President Andy Bowdoin. (See July 2009 post by PP Blog guest columnist Gregg Evans here.) […]