QPay Europe Limited, has consented to a court order to give up £2m held in its name, following legal proceedings brought by the Financial Conduct Authority (FCA) under the Proceeds of Crime Act.

The FCA had raised concerns following an application by QPay to become a regulated firm in March 2020.

QPay has since withdrawn its application to be regulated by the FCA.

The money had been frozen since proceedings begun following seven freeze orders granted in October and December 2020.

The FCA claimed the £2m was the proceeds of illegal activity connected to criminal proceedings in the United States of America concerning an alleged conspiracy to commit wire fraud against banks, credit card companies and other financial service providers in the USA.

The FCA said it is not alleging that QPay is involved in this conspiracy.

QPay received the money from software firm, Fintech International Q Software WLL, allegedly as an investment. However, the FCA observed QPay moved the money repeatedly to different bank accounts in several countries and none of the transactions appeared to be related to legitimate business.

Following consenting to the court order at Westminster Magistrates Court, the £2m held by QPay will be paid to the UK Government.

Mark Steward, executive director of enforcement and market oversight at the FCA, said, “Account forfeiture orders are an important means of intervening and capturing illegal money and this action is a good example of what can be done.  The funds will now be used to assist the FCA and other authorities fight illegal activity.  The FCA will continue to vet applications for authorisation to ensure firms meet our standards of integrity as well as competence.” 

The application for the £2m to be made forfeit was made by the FCA in October 2021.