Online companies laundering money

In recent months online companies are hitting media headlines for all the wrong reasons. Some unscrupulous persons have already tarnished the image of this potential business sector through swindling large numbers of people. While many of the fraudsters are now waiting in jail for trial, hundreds of their aggrieved clients are lamenting their fate out on the roads. A good number of them have lost the entire amount of their business capital trusting the Ponzi Schemes of these con men. The chances of recovery of invested money is almost nil as investigators found very little bank balance or assets against the names of the main operators.           

The latest scam of these online platforms has been presented in detail in the front page report in this daily yesterday. It says that some online-based groups are laundering large amounts of money from Bangladesh through their ‘e-gift card’ businesses by attracting unsuspecting people, mostly the young and the adolescents.

The fraudsters illegally create e-money under the pretext of virtual gift cards to pay subscription fees for services such as watching movies or boosting content on YouTube and Facebook. Reportedly, they also help customers transfer money to services like PayPal, debit Visa or MasterCard. During this process, the operators receive payments in local currency and convert them to US dollars. Among the service providers are Daraz.com, bd.techtreek.com, Ecard.com.bd, Gift card bd, ecard.com.bd, giftcardszonebd.com, and gift card house. 

Business Post report elaborates that these companies receive money from local customers through mobile financial services (MFS) such as bKash, Nagad and Rocket against virtual cards or products and pay the international service providers or companies through illegal channels. This may be mentioned that many people in Bangladesh purchase products from online shopping sites like Amazon, Alibaba through virtual PayPal, debit Visa or MasterCard. Besides, Google Play, Apple iTunes, Xbox & PlayStation, Nintendo, Steam and many more gift cards are available in the country.

Business sources revealed that anyone from Bangladesh could send any amount to a PayPal account and buy anything from an international e-commerce company. This has been corroborated by an e-gift card store owner who said that it is possible to transfer any amount to a PayPal account in the USA from Bangladesh without any extra charge. On the other hand, if a customer wants to send money to any country other than the US, she/he will have to pay an extra fee. They will have to pay through MFS. It is more like a hundi system (Illegal money transfer system). Our report further says that some of these companies offer gift cards worth $50-100.

Online companies claim that they use Payoneer for exchanging any amount above $200, and they use gift cards for payments below $50, which according to them is a legal procedure. But, it is quite disconcerting to learn that some owners did not bother to obtain Bangladesh Bank’s permission to provide financial card services.

Banking sources however confirm that only banks or financial institutions approved by the central bank can send money abroad and issue MasterCard or Visa Card. Therefore, they warn, people should be careful about those who are offering international financial services such as PayPal, debit Visa and MasterCard in Bangladesh without BB’s approval. In Bangladesh, financial crime investigators say that young adolescents who play online games on smartphones or electronic devices buy these virtual gift cards. Bangladeshi merchants who sell goods on e-commerce sites or Facebook and promote video clips on YouTube are using virtual cards to avoid banking system hassle and evade the government’s 15 per cent VAT.

That a strong network of unscrupulous people in the country is working illegally with the cooperation of some Bangladeshis living abroad, especially in the USA, is evident from the comments of the online business operators involved with this transaction system. 

 What we find is a big gap between the cup and the lips as far as implementation of the laws to control money laundering is concerned. We believe authorities concerned will have to be one step ahead of these online companies and stop them on the track before they can commit a big crime.