News / Vancouver

U.S. designates Vancouver company PacNet a ‘criminal organization’

Vancouver-based payment processing company PacNet connected to money laundering and global mail fraud, U.S. Department of the Treasury alleges.

Metro File

A Vancouver company has been designated a “significant transnational criminal organization” by American authorities.

The U.S. Department of the Treasury’s Office of Foreign Assets Control made the designation on Thursday, alleging that PacNet Group – a international payment processor with offices in Vancouver, Ireland and the United Kingdom – “has a lengthy history of money laundering by knowingly processing payments on behalf of a wide range of mail fraud schemes that victims in the Unites States and throughout the world.”

The statement says the U.S. Treasury is working with its Department of Justice to take criminal actions, including executing search warrants, filing civil injections and seizing PacNet’s bank accounts in the U.S.

The department alleges PacNet is the “third party payment processor of choice” in a wide range of mail fraud schemes, cashing cheques sent in by victims of scams.

A CNN investigation into global mail fraud this week alleged “tens of millions of dollars in scam proceeds” had been deposited by the company.

The U.S. Treasury said in its statement that PacNet has continued to process cheques linked to mail fraud campaigns despite “many notifications” from U.S. authorities.

“As an example of the clear warnings PacNet has ignored, the North Dakota Attorney General contacted PacNet in 2009 regarding the Group’s processing of payments for the 'Maria Duval' psychic scam,” the statement reads. “Although PacNet eventually refunded the money to the victims, PacNet continued to process transactions for the Duval scheme for over five years.”

PacNet’s North American office is located at 595 Howe St. in Vancouver.

Some local media report police were seen at their Vancouver offices on Wednesday, but Vancouver police refused to comment on Friday.

“Anything to do with PacNet is something I’m not able to get into,” said VPD spokesperson Const. Brian Montague. “Any information provided by U.S. authorities and the U.S. Treasury, any questions related do that, will have to be asked of them but I’m not in a position to discuss it.”

Metro has contacted PacNet via email and phone, but has yet to receive a response from the company.

However, the company's attorney, Tom Clare, told the CNN the company’s payment processing services are legitimate, that it has co-operated with authorities and that “PacNet has consistently and unequivocally stated that it has never continued to process payments for any promotion that it knew to be deceptive."

A spokesperson for federal regulator Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) told Metro it is assessing the information regarding PacNet but – citing the Proceeds of Crime (Money Laundering) and Terrorist Financing Act – cannot comment on “its disclosures or data holdings.”