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A Ukrainian bank has been caught in a money-laundering scandal involving Russian crypto operators
Concord Bank may have taken part in dubious transactions of Russian cryptocurrency exchange services Exmo and Suex. The latter company was sanctioned by the U.S. last week on suspicion of financing hacker groups.
The Dnipro-based bank became the subject of reports in Russian media (Kommersant, The Bell) alongside the Russian–Czech exchange Exmo and the Moscow-based crypto exchange service Suex following a complaint from the local movement “StopNarcotic.” Activists appealed to law enforcement, alleging that Concord allegedly provided acquiring services for the benefit of the Russian marketplace Hydra, which trades in drugs.
“Transactions from payments for the purchase of cryptocurrency in hryvnias on the territory of Ukraine via the Exmo crypto exchange and via Concord Bank’s acquiring,” the organization’s press service told Forbes. StopNarcotic did not provide supporting documents. According to the Russian Kommersant, the movement demands that the Russian central bank and law enforcement “block payments to the Ukrainian financial institution.”
Another participant in the payment chain named by StopNarcotic is the Russian payment system QIWI. In Ukraine it operated under the name TYME until 2018 — when the NBU revoked its license. The organization also believes that the Virgin Islands company Hotpay and the payment service Easy Transfer could have been involved in operations in Ukraine. The latter does indeed cooperate with Concord Bank, providing it, as well as PUMB Bank and the finance company Hunter, with payment infrastructure operator services.
How might the roles of the alleged participants in operations benefiting Hydra have been distributed?
Suex is a service for converting cryptocurrency to fiat money and vice versa. Since its founding in 2018, Suex has moved cryptocurrency worth hundreds of millions of dollars, mainly in Bitcoin, Ethereum, and Tether; the majority of funds came from illicit sources (ransomware hackers, financial pyramids, drug trafficking) — about $370 million, reports the Russian outlet The Bell citing analytics firm Elliptic.
In 21, the U.S. imposed sanctions on Suex: the platform is suspected of facilitating financial operations of hackers who specialize in extortion and ransom demands.
Exmo is one of the largest cryptocurrency exchanges in Eastern Europe. Unlike Suex, which specializes in cashing out funds from crypto wallets and vice versa, Exmo facilitates crypto exchanges between users. The service is indeed used for payments for drug supplies — such cases have been established, among others, by the Ukrainian cyber police.
Suex and Exmo share common roots. The crypto exchange was founded by Russian entrepreneur Ivan Petukhovsky; he is also one of Suex’s co-investors, along with namesake Yegor Petukhovsky, as well as Maksim Subbotin and Ildar Zakirov, The Bell notes. After the U.S. announced sanctions against Suex, Exmo stated that it has no relation to the crypto exchanger. The exchange also denies any connection with Concord Bank, Russian outlet RBC writes.
How could the bank have participated in the Russians’ dubious operations? A possible linking node is a financial company that accepts cashless hryvnia payments for subsequent exchange into cryptocurrency, says Mikhail Chobanyan, cofounder of the Ukrainian crypto exchange KUNA, to Forbes.
“Technically, the bank in such a situation services the finance company’s accounts and provides it with acquiring services,” Chobanyan explains.
A source in the National Bank’s top management noted that Concord Bank has indeed increased the volume of its acquiring operations. Officially, the NBU had not responded to Forbes’ request by the time of publication. Concord Bank’s CEO Yuriy Zadoya refused to comment on the situation with the Russian crypto services. Concord’s press service had not responded to Forbes’ request at the time of publication.
According to the NBU, the Concord banking group includes, in addition to the bank, the Ukrainian finance companies Kordpay, Mastpay, Procard, and Syncom, as well as nonresident companies: the British Electronic Payment Solutions LTD and the Maltese Moneycare Limited. The group’s owners are entrepreneurs from Dnipro, Olena Sosedka and Yuliya Sosedka (56,2% and 43,8% of shares respectively).
Source: Forbes
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