Nigerian-led Ping Express fails to prevent laundering, faces 5-year probation in the U.S
Two US-based Nigerian fintech executives pleaded guilty to failure to maintain an effective anti-money laundering policy.
Ping Express will face five years of probation and a fine of over $500,000 after its CEO Anslem Oshionebo and COO Opeyemi Ode pleaded guilty to failure to maintain an effective anti-money laundering policy after sending $167 million to Africa unchecked in less than 3 years, including $160 million that was sent to Nigeria.
The anti-money laundering policy violation
Although, Ping Express outlined its anti-money laundering policy in a memo to state regulators stating that first-time customer transactions are limited to $499, daily transactions to $3,000, and monthly transactions limited to $4,500. The Nigerian-led fintech company admitted that it allowed more than 1,500 customers to violate these rules. In one instance, Ping allowed a customer to remit more than $80,000 in a single month— 17 times above the proposed limit.
In an investigation conducted by Homeland Security Investigation’s Dallas Field Office and the Texas Department of Banking, three individuals—including two of Ping’s top customers—previously pleaded guilty to transmitting illegally-derived funds through Ping.
"By law, Ping was required to report any suspicious transactions to regulators. In plea papers, it admitted that it failed to file a single report over a three-year period, despite a significant amount of suspicious customer activity," Erin Dooley, Press Officer of United States Attorney's Office, Northern District of Texas wrote in a press statement on July 7, 2022.
According to Dooley, sentencing has been set for December 19, 2022. Meanwhile, Aleoghena Okhumale, Ping’s IT and Business Development Manager, pleaded guilty to knowingly transmitting illegally-derived funds. Oshionebo and Ode were each sentenced to 27 months in federal prison, while Okhumale received a prison sentence of 42 months.
Ping Express indulged in unauthorised transactions
According to court documents, the company—which was licensed to transmit money but was not authorised to conduct currency exchange—charged its USA customers a fee to remit money to beneficiaries in Nigeria and other African nations.
"Ping also admitted that it conducted money transmission business in states in which it was not licensed to do so, including Nevada, New Jersey, Utah, West Virginia, and Connecticut," Erin Dooley stated. Ping Express is properly licensed in Texas, Maryland, Georgia, Washington, and Washington, DC. Although the fintech company claimed to have software that could detect and deter transmissions initiated in “unlicensed” regions, the software was not functional.
Ping Express was used for a 'romance scam'
According to the statement, three individuals—including two of Ping’s top customers—previously pleaded guilty to transmitting illegally-derived funds through Ping.
"One, Collins Orogun, admitted last week that he accepted a fee in exchange for transferring money for ‘romance scam’ fraudsters and other criminals. In one instance, an Indiana woman sent $15,000 to ‘Carson Jacks’, a purported oil roughneck in the Gulf of Mexico she fell in love with online, after he told her he’d contracted malaria. In another, a second Indiana woman sent $6,300 to ‘Thomas Ken,” a purported Irish ship captain she fell in love with online, to fix his ship.
“In two years, Mr. Orogun received more than $1.3 million in cash, cashier’s checks, and wires into several U.S. bank accounts he controlled, and then quickly moved more than $1 million of the funds to Africa through Ping. He faces up to 20 years in federal prison and is set to be sentenced on January 23, 2023,” the statement read.
About Ping Express
Founded in December 2014, Ping Express officially commenced operations in 2015 to provide an alternative means for global remittance. The fintech company was licensed as an international money transfer operator (IMTO) by the Central Bank of Nigeria in 2016.
Ping Express has previously signed several African celebrities including—Nigerian comedians; Basket Mouth, Wamilele, and Woli Arole; Zimbabwean comedian, Alfred Kainga; Nigerian musician, May D—as brand ambassadors.