Nigerian-American Fintech founders jailed over failure to maintain anti-money laundering rules

Citing part of the company’s plea documents, the US government said the company admitted it allowed more than “1,500 customers” to violate its anti-money laundering policy.

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A U.S court in Texas has convicted two Nigerian-American Fintech founders to 27 months to federal prison after their company, Ping Express U.S. LLC was found to have been used to transmit $160 million of illegally-derived funds to Nigeria. 

Anslem Oshionebo, the Chief Executive Officer (CEO), and Opeyemi Odeyale, the Chief Operating Officer (COO) of Ping both pleaded guilty to failure to maintain an effective anti-money laundering program, a US Justice Department statement said.

“In less than three years, the company transmitted more than $167 million overseas, including $160 million transmitted to Nigeria. The company admitted it failed to seek sufficient details about the sources or purposes of the funds involved in the transactions, or the customers initiating the transmissions,” the statement stated. 

The company’s IT/ Business Development Manager, Aleoghena Okhumale, is said to have also pleaded guilty to knowingly transmitting illegally-derived funds and was sentenced to 42 months.

“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. Ping Express U.S. LLC pleaded guilty Wednesday to failure to maintain an effective anti-money laundering program.”

Two of the company’s top customers are said to have previously pleaded guilty to transmitting illegally-derived funds through Ping. A Collins Orogun is said to have admitted he accepted a fee in exchange for transferring money for “romance scam” fraudsters and other criminals.

“In one instance, an Indiana woman sent $15,00 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 Jan. 23, 2023,” the statement indicated. 

Court filings also stated the company charged U.S. customers a fee to remit money to beneficiaries in Nigeria and other African nations even though it was not licensed to conduct currency exchange.

Citing part of the company’s plea documents, the US government said the company admitted it allowed more than “1,500 customers” to violate its anti-money laundering policy.

“The company outlined its anti-money laundering policy in a memo to state regulators, claiming it would cap first-time customer transactions at $499, cap daily transactions at $3,000, and cap monthly transactions at $4,500.

However, in plea papers, the company admitted 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 – more than 17 times the purported limit”, the statement read in part.

The U.S. Attorney for the Northern District of Texas, Chad Meacham said the company now faces a five-year probation and a fine of up to $500,000.  Sentencing has been set for Dec. 19, 2022, the statement noted.