Stripe’s Inadequacy to Detect Illicit Crypto Activity Leaves it to Pay $120K

According to news sources, the Office of the Attorney General has said that the system of Stripe failed to detect the illicit crypto activity due to the system being inadequate and outdated.

In Brief

In an effort to clear out the allegations leveled against Stripe, which is a payment processing entity in the US, it has consented to pay at least US$ 120,000/- as compensation.

Stripe has also categorically admitted that the system it has put in place is inadequate to detect any payment transactions which are illegal and in particular the illicit crypto activity.

The Office of the Attorney General also alleged that the alleged organizers of a Ponzi scheme called PlexCoin, which is labeled as a scam by the US Government, has successfully processed certain payments through the Stripe system without getting caught as being illegal transactions.

The Massachusetts Attorney General’s Office alleged that Stripe processed payments made by the organizers of PlexCoin, an alleged crypto scam.

In an earlier attempt, PlexCoin was able to commit scams and frauds on various people to the tune of US$ 8 million approximately.

In order to settle the allegations raised by Attorney General’s Office against the US payment processor, Stripe has announced that it will be paying US$ 120,000 for being unable to detect the fraud due to the failure of its fraud prevention system which has resulted in the organizers of PlexCoin to process their illegal gains without any problem at all.

According to news reports, in the month of July this year, PlexCoin was found to be involved in defrauding three individuals who were the citizens of Canada as well as the scam company also defrauded many investors. According to the Attorney General, over twenty individuals amongst the investors were residents of Massachusetts and the medium used by the perpetrators was none other than the Stripe.

As per the assurance of discontinuance signed between the AGO and Stripe, the document shows that due to the failure of Stripe’s fraud prevention system, Dominic Lacroix, who is the owner of PlexCoin and the mastermind behind the fraudulent scheme, was given safe passage to siphon off the looted money without getting caught.

The Attorney General of Massachusetts also alleged that there is a possibility that both, Dominic Lacroix as well as Stripe may have connived with each other or that there is a possibility that Stripe was within the knowledge of the transaction but intentionally allowed it to happen. He said that the matter is still under inquiry and more facts will be brought to the knowledge of the general public.

The document signed between the two, however, does reflect any admission of guilt on the part of Stripe as well as the amount offered by Stripe is not treated to be a penalty but it is more or less compensation for the customers of Massachusetts.

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