A Texas money transfer company has admitted that it did not sufficiently guard against money laundering.
As announced by the U.S. Attorney for the Northern District of Texas, Ping Express U.S. LLC and its executives pleaded guilty on July 6 to failure to maintain an effective anti-money laundering program.
Ping is licensed to transmit money but not licensed to conduct currency exchange. However, court documents state that the company remitted money to beneficiaries in Nigeria and other African countries for a fee.
The office of the U.S. attorney said that Ping was required to report any suspicious transactions to regulators. However, the company admittedly allowed a significant amount of suspicious customer activity and failed to file a report on it for three years.
In a memo to state regulators, Ping claimed it set a limit of $499 for first-time customer transactions, $3,000 for daily transactions, and $4,500 for monthly transactions. However, the company admitted to allowing more than 1,500 customers to violate the rules.
Court documents state that Ping once let a customer remit more than 17 times the limit. The customer had remitted more than $80,000 within one month.
The U.S. attorney’s office said that Ping transmitted more than $167 million overseas in less than three years. The company told prosecutors that it failed to seek sufficient information about the sources and purposes of the funds or the customers who initiated the transactions.
Before Ping’s guilty plea, authorities said three people had pleaded guilty to transmitting illegally-derived funds through the company.
One of the three, Collins Orogun, admitted to transferring money to “romance scam” fraudsters and other criminals for a fee. A woman from Indiana had sent $1,500 to one “Carson Jacks,” a supposed oil roughneck in the Gulf of Mexico whom she had met online and fallen in love with. Carson Jacks told the woman he had contracted malaria.
A second Indiana woman sent $6,300 to one “Thomas Ken,” a supposed Irish ship captain she met and fell in love with online. Thomas Ken had asked the woman to send the money to repair his ship.
The money sent by both Indiana women went to Orogun, who controlled several U.S. bank accounts. Orogun received over $1.3 million in wires, cashier’s checks, and cash and quickly moved more than $1 million of the funds to Africa through Ping.
Orogun’s sentencing is scheduled for January 23, 2023. He faces up to 20 years in federal prison.
Ping also admitted to conducting money transmission business in states where it did not possess a license to operate, including Connecticut, New Jersey, Nevada, Utah, and West Virginia. The company was only licensed to conduct transactions in Georgia, Maryland, Washington, Texas, and Washington, D.C.
While the company told state regulators that it had a software program that could detect and stop transmissions initiated in unlicensed states, it admitted that the program did not function. To cover that up, the company only recorded states in which it was properly licensed in its summaries to state regulators.
Ping as an entity now faces five years of probation and up to $500,000 in fines, with sentencing set for December 19, 2022.
The company’s CEO, Anslem Oshionebo, and COO, Opeyemi Odeyale, who were individually charged in the case, pleaded guilty to failure to maintain an effective anti-money laundering program. IT/Business Development Manager Aleoghena Okhumale also pleaded guilty to knowingly transmitting illegally-derived funds.
Oshionebo and Odeyale were each sentenced to 27 months in federal prison, while Okhumale was sentenced to 42 months.
The Dallas Field Office for Homeland Security Investigations (HSI) conducted the investigation into Ping.
“Through our special agents and forensic accountants, we work endlessly to eradicate crimes involving money laundering and bulk cash smuggling,” said Christopher Miller, acting special agent in charge of HSI Dallas. “Our investigative reach provides access to a wide range of financial networks, allowing HSI to disrupt any criminal organization attempting to exploit global trade.”