Iban Wallet fraud investigated by Latvian authorities

Iban Wallet fraud has gained some attention by Latvian journalist Liene Barisa-Sermule and by Latvian authorities as well. Liene researched Iban Wallet and interviewed me as well. What did she find out?

The story about Iban Wallet fraud is on frontpage of several news sites in Latvia:

Content is in Latvian, but you can get Google Translate versions here:

Or if you understand Latvian, check out this video:

And below is a translation to English:

Latvia has proved attractive for the registration of company that is related to another financial platform. Iban Wallet, which promises safe investments and good profit on its website, is officially a practically empty company with an address in Riga. And it looks like it could be a stage of a wider, multi-million-dollar network set up to generate revenue and get money from investors without clear guarantees, reports Latvian Television's "De facto" program. The company is also inspected by law enforcement and supervisory authorities.

All you have to do to invest through Iban Wallet is download the app on your phone. The platform operates internationally, but the company itself, whose legal name is "New Generation Market", is registered in Latvia. According to Lursoft, it was founded here by the British Marc-Anthony Hurr, but now the real beneficiary and leader is the Afghan citizen Ahmad Maiwand Noorzai with a document issued in France. No employees.

In the summer of 2019, “New Generations Market” with its first name “Iban Wallet Corporation” was registered at Vējdzirnavu Street 28 - 13. It is a residential building. Currently, ten more companies are registered in the apartment. Almost all of them are owners from abroad, but no representative can be found there. There is no evidence of an international financial platform at its current address at Lāčplēša Street 87. In Berlin, where, according to the website, the platform has the central office, there is a co-working space. The presence of Iban Wallet could not be confirmed or denied there.

Kristaps Mors, a financial blogger, started researching Iban Wallet, and realized that something was wrong as soon as he visited its first registration address. "If you're an investment company that should get some credibility from the investors, and you've registered in some unreachable place, well, that's a signal that it's better to avoid it," he concludes.

However, the main sign of risk is the lack of formal financial activity.

In 2019, there was no financial activity at all. Official data for 2020 is not yet available, but it is known to “de facto” that the company has started paying taxes, but this is a relatively small amount.

The account in which the platform's investors deposit money does not belong to the New Generation Market, but to an unclear owner. Kristaps Mors has concluded that around 20 companies in different countries have been created with some relation to the platform, which is mainly connected to the founder of the Latvian company Marc-Anthony Hurr.

"The only company where any major financial flows could be detected or seen was a company registered in Estonia, and their financial statements showed at the end of 2019, that investors had invested 47 million euros. At the moment I predict that they have collected about 100 million, maybe even more. And this is the money that investors can lose, and most of it is likely to be lost, ” says Mors.

When the company was established in Latvia, the Register of Enterprises did not evaluate the dubious address, because it was not in the SRS register of risk addresses.

An additional inspection may be required if at least ten companies have already been registered in the specific place, but this has not been the case on Vējdzirnavu Street. The business register initiated administrative proceedings to verify that the New Generation Market could be reached at its current address, sent a letter and received a reply. State Chief Notary Guna Paidere points out: “Of course, we do not go to check the address on the spot and do not investigate. We do not have the powers of law enforcement authorities to check whether what they are telling us really corresponds to the actual situation. If there is a reaction, we will also close this infringement procedure. " For what cannot be checked by company register,

The business register can go to law enforcement, and it is known "de facto" that this has happened. The state police confirmed that the case was being investigated by the department.

The company does not have a permit to attract financial investments, and it has not asked Financial and Capital Market Commission (FCMC) to receive a license. But the commission has started inspecting the company's operations and, if necessary, passing the information on to the police. The FCMC emphasizes that it inspects the operation of this company in Latvia. “We evaluate from the point of view that the company is registered in Latvia and we evaluate their activities in Latvia. We don't really inspect what they do in Mexico or any other country. But, of course, in order to evaluate in detail the company, its partners, the whole scheme of these activities, we also look at the role and contribution of other companies involved. As all this is such a complex assessment, ” explains Ingus Valtiņš, Senior Legal Adviser of the FCMC Licensing Department.

The authorities acknowledge that, with the development of financial platforms, efforts to use them for fraud and money laundering are increasing. For this reason, the Financial Intelligence Service (FID) is also paying attention to this sector. It is not allowed to comment on specific examples in the service, but several financial platforms have already come to its attention.

Paulis Ilyenkov, Deputy Head of the Strategic Analysis Division of FID, points out that there are various signs of risk, which indicate that the platform is not reliable.

'Of course, there are various red flags that can be highlighted in the following cases: how many employees does such a company employ to ensure the effective provision of such a service. Understandably, financial service providers also need serious IT infrastructure to ensure the security of these services. And another thing is the company's turnover," he explains.

It is not really possible to get an explanation from the Iban Wallet. The telephone number of the Latvian company indicated in the registers does not exist. Founder Marc-Anthony Hurr did not reply to the email, but

Laura Estrada, Iban Wallet's public relations spokeswoman, said in an e-mail that they were not an investment platform but a programming company that provided a market site for others.

This does not prevent Iban Wallet from presenting itself as an investment platform in the website and advertisements.

For a long time, Estrada refused to answer why Latvia was chosen as the place of registration of the company representing Iban Wallet. After repeated reminders, however, to provide answers to specific questions, she said that one of the board members came from Latvia. There was only one founder and board member at that time - the already mentioned British citizen.

The company's representative did not respond to the complete lack of financial activity in 2019 and the current financial situation of the company, only indicating that the money is in a local account and the authorities have been informed about it.

Source: https://www.lsm.lv/raksts/zinas/latvija/latvija-izgaismojas-saubiga-finansu-platformas-uznemumu-shema-kas-ir-iban-wallet.a391058/

Previous posts about Iban Wallet fraud:

Key Takeaways

  1. Iban Wallet is being investigated by police, Financial and Capital Market Commission and Financial Intelligence Service in Latvia.

  2. Company register in Latvia is almost useless - as long as someone receives their letters, they don’t care or don’t have any authority to shut down the company, even if it is an empty shell of a fraudulent investment scheme.

  3. When Iban Wallet will collapse, Latvia will get recognized as country of another P2P ponzi scheme, but in this case no one from Iban Wallet has any connection to Latvia besides creating empty, shell companies.