Alertpay and the frozen US funds

Alertpay has had it funds frozen by the US Government in 29 states; there is a strong possibility that the other states will be affected in the same way. Once the account has been frozen, there is no way to access the money within. Transferring it to another member is also prohibited. Many holders of these frozen accounts have taken to online media to express their disgust at such an occurrence. One blogger advises that if you live in the USA and still have access to your money you may wish to withdraw it whilst you still can. Currently 62% of all accounts are in a frozen state and it won’t be long before this figure is 100%.

This same blogger goes on to publish the reply which was received from Alertpay when logging into their account.

QUOTE

With regards to your funds:-

The funds currently held within your account are safeguarded and secure as stated by the regulatory guidelines published by your state.

We are currently unable to complete any transactions whether its withdrawal or transfer at this moment in time due to the funds being withheld by Ultralight Financial Services, formerly known as “Obopay”. This company is a licensed US money transmitter and Alertpay acted as an agent on their behalf. This has come about due to a change in management, though it is unclear why this should be.

Despite repeated efforts to resolve the problem we have contacted both their management and their legal department and your state regulator. We are currently considering legal action against Obopay, Ultralight and their CEO, Carol Realini. As with most legal processes, this will be time consuming.

Your state regulator has informed us that they will only intervene on your direct instructions, as the owner of the funds. We therefore strongly advise you to demand action from Obopay/Ultralight and you state regulator. We suggest you use the following template for your complaint:-

Dear (insert name of state regulator),

Alertpay has informed me that Obopay/Ultralight is refusing to release my money or make it available for transfer to another account. Please look on this as an official request to intervene and take immediate action to resolve this situation.

Thank you,

(Please sign the document and clearly print your full name).

We would like to take this opportunity to stress that your current funds are securely held and are safeguarded by the Issuing Agency relevant to your home state.

In December 2012 Alertpay locked a considerable amount of Uinvest funds which prevented access to the funds which they contained.

Alertpay is not too friendly towards HYIP companies and Uinvest is no exception. Many HYIP accounts have been blocked in the past after it was discovered that it was turning into a scam and making “selective” payments to their investors. This can often happen after suspicious money transfers too. The accounts are then subject to verification which in the case of so many HYIP operators, the accounts that are used are fake or have been stolen. Because of this, the process cannot be completed and the funds remain frozen, indefinitely.

The problems began for Uinvest when some of their accounts were hacked and the shares sold off or funds withdrawn. The company was threatened by the hackers if the money was not released. This came to the attention of Alertpay who decided that Uinvest was a risky company and locked down a large percentage of their accounts.

Most HYIPs can be considered to be risky due to the nature of their business but Uinvest suggests that their funds are blocked due to Alertpay running out of money. They go on to say that the money is used to solve the problems that they have with the Canadian authorities but also say that they will dissolve the current agreement which they hold.

It is common knowledge that Visa and MasterCard payments are currently suspended. This is the second time in a few months that this has happened. The first time was in March last year when a German partner of Alertpay suspended operations with them due to the accusations of them processing payments on behalf of child pornographers, drug dealers and illegal gambling services. The second time was when one of the company’s bank accounts, Norway SEB, suspended Alertpays’ account. Firoz Patel who is listed as the CEO was quoted as saying that this was part of a smear campaign by a former employee who was trying to discredit him before he started his own company in direct competition.

It is noted that both Visa and MasterCard payments are still suspended, but Firoz Patel assures us that talks between both parties will soon resolve the issue. Uinvest replied with the following comment:-

Lawyers were instructed to act on the situation due to Alertpays unprofessional approach and the fact that they locked several accounts for no apparent reason. They went on to say that they are currently holding talks with another payment gateway provider and hope to finalise the details by which time, they will sever all dealings with Firoz Patel and his company.

A counter statement from Firoz Patel’s press office stated that they are not having any problems with the Canadian authorities and have received no instructions from Uinvest’s lawyers.

This is a very complicated saga with differing accounts coming from each side. The fact still remains though that the US Secret Service instructed the FBI and the Department of Homeland security to freeze all assets held by Patels company until a resolution was found. This had the effect of denying access to funds for all US account holders. These accounts were inaccessible for well over a year and many customers have since reported that they never saw their money again. They considered that it had been stolen whilst in the frozen state.

Alertpay continue to deny this by stating that it was Obopay who refused to release the money which was under their control. However, we have already seem that Obopay were only ever acting on instructions and had no control of the money which they processed on behalf of Alertpay. Most customers who were victims of this scam wholeheartedly recommend others to avoid Firoz Patel at all costs. You have been warned!

The launch of Payza online scams in the emerging nations of Bangladesh and Pakistan.

In January 2013, Payza sponsored the e-commerce week in Dhaka, Bangladesh which ran concurrently with Dhaka Start-up week. Firoz Patel spoke at both events about his role as Executive Vice President at Payza and outlined his company’s prospective launch in Bangladesh. No mention was made of the Payza online scams which could be introduced as part of his plan. During his brief stay in the country, he spoke at several events and hosted discussions about his vision for the future of e-commerce in this emerging nation. He held long talks with the Deputy Governor of the Bangladesh bank, Nazneen Sultana. He also spoke to a representative of the main television service provider, Ekushey.

He spoke of his hopes and thoughts about the introduction of his payment gateway company to Bangladesh and how he would help bring their e-commerce sector up-to-date and in line with the rest of the world. He outlined his intention to avail his company to this fledgling sector with the hopes of building strong bonds with prospective clients. What he didn’t talk about were the Payza online scams that would start as well.

As an emerging market, most of the country does not have access to the internet which could also be said for the majority of the western world just 15 years ago. No one had heard of Payza online scams either! With the proliferation of smartphones and tablet computers, it is hoped that this situation will improve with the advances made in mobile telecommunication systems. After his meeting with the main service provider he spoke of his anticipation that the entire country would have a strong internet service within the coming year. He also offered his help and expertise in the hope of avoiding the “teething” troubles often associated with such a step. Secretly gloating at thoughts of the raft of Payza online scams that would inevitably follow!

Firoz Patel emphasized a few of the following points whilst conducting his forums: -

1.    The younger generation is the key to the success due to their acceptance of new technology. This can be said for most countries and not just for Bangladesh. The younger generation embraces new technology more readily than their parents and computer studies are part of the standard curriculum in nearly all schools and colleges. This will help build a successful e-commerce sector for the intended online market place.

2.    Payza believes that the strength of any company lies within its customers which can be said for all merchants who conduct business over the internet. The system needs to be user friendly and accessible to the vast majority of the country for it to be effective. With the help of the telecommunication service providers, this will be more than a possibility in the coming months.

3.    Users need the confidence to use such a system and e-commerce should be intuitive and as simple as possible. Banks too need to know that their money will be safeguarded and they will not be susceptible to unnecessary risks. The public also needs the confidence to use an online payment system which is a whole new concept for most of them. Many of them will never have heard of the Payza online scams which have been happening throughout the rest of the world.

The challenges that face Bangladesh are: -

1.    Infrastructure. The process has to be in place which will allow the flow of money to enter and to leave the country. There are no data centres set up to process this information at the moment, but as part of the expansion plans, several centres are being built to redress this situation.

2.    Internet access is still spasmodic throughout most of the country, but the building of many new masts will change this situation within months.

3.    The shipping of products from the heart of the country to international destinations remains one of the biggest challenges due to the lack of existing infrastructure. Again, this is due to change within the coming months. The need for a payment processing company to enable payment for these products is what Firoz Patel is offering with his Payza online scams.

International trade is steadily increasing with these Asian nations due to the relatively cheap production costs of manufactured goods. These suppliers need a payment gateway that can accept and make payments with ease. Other companies such as PayPal have very strict rules and regulations and therefore cannot offer their full range of services to merchants in Bangladesh. Payza has been designed to skirt around these regulations and advertise themselves as the chosen provider for financial services. More opportunities will arise for their Payza online scams.

Throughout the world, there is no central body that controls or monitors the international movement of money. Dealing with so many countries and their individual restrictions currently makes it impossible to govern. This is an ideal situation for Firoz Patel to exploit with his Payza online scams which have happened so often in the past with devastating consequences for those caught up in his fraudulent dealings.]

Many Bangladeshis find well paid work abroad and send money home on a regular basis to help support their families back home. The only way this can be achieved is by using a company such as Payza to send regular payments over the internet. What they don’t realise is the risk they are taking and the possibility of becoming a victim of Firoz Patel’s Payza online scams.

The Patel brothers exploit the relative lack of education for most of these migrant workers and rely on the ignorance of the government to the rules and regulations of online payment systems. Bangladesh is not known to have a strong voice at the meetings held by the International Monetary Fund’s committee.

When Firoz visited the country in 2013 it was to these people that he gave his promise of help to. As has happened so often in the past, this promise will not be kept.
The accounts will be allowed to operate smoothly at first whilst confidence in this new way of making payments, grows. After a few short months, the emails will arrive stating a breach in the terms and conditions and the resulting freezing of the accounts until a resolution is found.

The victims who are low paid and often uneducated will have no idea how to challenge such a large international company. If they manage to seek help from a bank worker or government official, it is highly likely that they will be unable to offer assistance in the refund of the lost money. Some officials are known to be as corrupt as the Patel brothers and will be ignorant to the Payza online scams.

Rupees, Dollars or Euros, the Patels do not care what currency it is as long as their Payza online scams continue to dupe their customers out of their hard-earned cash.

What makes the Payza scam so effective?

The Payza scam was conceived by Firoz and Ferhan Patel who launched a payment processing company which operated out of Montreal, Canada. It was marketed as a payment gateway similar to PayPal or Dwollar where individuals could send money to each other and for businesses to receive money for goods or services. The legitimate companies such as PayPal have very strict terms and conditions and cannot offer a full range of services in many countries due to national restrictions. This is where Payza stepped in to fill the gap. There are millions of legitimate companies who need a payment processing company that they can trust to move money internationally. Unfortunately Payza is not a company to be trusted!

The Payza scam was conceived by two criminally orientated con men who targeted other illegitimate businesses who needed a processing company which would allow them to accept online payments for their ill-gotten gains. The first group of companies to be targeted were those run by Ponzi scheme operators or HYIPs. These High Yield Investment Programs offer huge returns on initial investments of up to 1000%. There are often registered offshore or in South America and need an online payment processor to enable them to receive money from their clients. No other payment gateway operator would have anything to do with such illegal companies, so it was an ideal situation for the Patel brothers and their Payza scam who openly targeted such companies. 

Ponzi schemes have been known of since the early 20^th century. Local investors were conned on a relatively small scale compared with that of today. Digital payment gateways and processing companies, such as Payza has led to a huge increase because of the ease and anonymity that can be found online. Many of the early Ponzi schemes actually started their own digital currencies which they used to help them with their scamming ways. Eventually, all of these early attempts at digitalisation failed and resulted in many of the operators been incarcerated for money laundering. This left a considerable gap in the market for a company that would deal with these illegal operators. This is when Firoz and Ferhan Patel lintroduced their Payza scam to the unsuspecting cyber world.

How the Payza scam started

Payza was initially launched to service the online needs of the HYIPs who needed an online payment system to send and receive money from their clients. The legitimate companies such as PayPal would have no dealings with them due to the nature of their business. Payza had no such qualms about them and in fact openly advertised their services to them. They charged huge commissions of up to 25% on every dirty dollar that passed through their gateway and made millions of dollars because of it. They soon realised that this could be extended to include other illegitimate businesses, those operated by drug dealers, pornographers and people traffickers. Firoz and Ferhan Patel were able to use the money which passed through Payza for their own benefits, often claiming a breach to their terms and conditions which froze the clients’ accounts until a resolution was found. This very often took up to six months, by which time, the client’s account was emptied. As criminals themselves, they were not in a position to challenge this theft of funds. They, too, became victims of the Payza scam. It is not possible for an illegal drug dealer to take them to court or sue them.

It was around this time that a British teenager committed suicide due to the misuse of a drug supplied by one of Payza’s clients. A member of the British Parliament publically requested the Patels to stop processing payments on behalf of the drug dealer, but this request was refused. They claimed to have no idea as to what line of business their clients were involved with. This was shown to be yet another lie. Ex-employees have sworn, under oath that each client was categorised as to what business they were involved in; drug dealers, illegal arms dealers, pornographers, people traffickers or Ponzi operators. All payments to and from their accounts were recorded and documented. They made millions of dollars from the misery caused by their clients’ dealings.

Legitimate businesses and individuals were next to get caught up in the Payza scam. PayPal cannot offer a full range of services in many countries, due to no fault of their own. Some people who needed to move money internationally were drawn into using Payza as a way to complete their financial transactions. The same methods of fraud were used on this new batch of victims in that their accounts were allowed to operate smoothly for up to six months before the email was despatched informing them of an “alleged” breach of terms and conditions. The funds within would be frozen, pending the outcome of the ensuing enquiry . It is well documented that on more than one occasion the sum of money taken was close to $1,000,000.

The Payza scam made the world headlines in November 2013 when the US Secret Service became aware that Payza was processing money on behalf of a child pornographic ring from Canada. In order to avoid the ensuing scandal, all accounts held by illegally run companies were transferred from Payza to OboPay which was set up by the Patels for this sole purpose. They then went onto try and rebrand themselves as a legitimate company with no dealings with illegal operations. The US Secret Service instructed the FBI and The Department of Homeland Security to seize all US assets held by Payza. This affected millions of ordinary citizens who suddenly had no access to their accounts. Many have since stated that they never saw their money again, and consider themselves victims of the Payza scam.

One of the main reasons that this scam was so effective was that it initially targeted illegitimate businesses who basically operated beneath the law. They had no licenses to conduct financial transactions or the authority to do so. They openly stole as much as they wanted, without fear of legal redress, and used the money to finance their other business interests. They also filled the gap which was left after the collapse of the new digital currencies which had been used by the HYIPs as a means of running their businesses.

They subsequently crossed The Atlantic and rebranded their company under the umbrella of a British company, MH Pillars. The Payza scam would continue under a new name. They have also turned their attention to the emerging Asian markets as a possible target for another Payza scam.

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