Four executives with a Vancouver-based payment processing company have been charged with fraud and money laundering in Nevada.
Rosanne Day, 51; Robert Paul Davis, 63; Genevieve Renee Frappier, 49; and Miles Kelly, 55, are each facing one count of conspiracy to commit mail and wire fraud, one count of conspiracy to commit money laundering and multiple counts of mail and wire fraud.
Day and Davis were part owners of Vancouver-based PacNet Services Ltd., while Frappier and Kelley worked as marketing and compliance executives, according to prosecutors.
“The defendants are charged with enriching themselves by helping fraudsters who took money from elderly and otherwise vulnerable victims,” Assistant Attorney General Jody Hunt said in a media release.
“The United States Department of Justice will seek to hold accountable those who knowingly advance elder fraud schemes — including individuals outside our borders who enable fraudsters to move their ill-gotten gains into the banking system and benefit from their crimes.”
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The new charges are not the only legal trouble for PacNet. B.C.’s director of civil forfeiture is currently suing its principals to confiscate more than $15 million worth of properties and bank accounts alleged to be proceeds of crime.
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In a statement, PacNet called the latest indictment “factually flawed” and promised to fight the charges in court.
“PacNet never knowingly processed payments for a fraudulent mailing,” the statement reads. “If a customer complained, PacNet refunded its money and charged the mailer. PacNet stands by its compliance program.”
Fraud allegations
PacNet made headlines in 2016, when the U.S. Department of Treasury singled it and 12 individuals out as a “significant transnational criminal organization,” which had allegedly helped defraud Americans of hundreds of millions of dollars between 1994 and September of that year.
The company ceased accepting payments in 2016, and the the “criminal organization” designation was removed in 2017.
In the Nevada indictment, prosecutors allege that under the direction of the accused, PacNet acted as the “payment processor of choice” for scammers who sent bogus mailouts designed to mislead people about prizes, big cash payouts or specialized psychic services — for a fee.
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Day and Davis are alleged to have earned at least C$15 million each between 2013 and 2015 while the company acted as “middleman,” knowingly accepting fraudulent payments and depositing them in its own bank accounts, before distributing them to its clients.
Prosecutors allege Davis operated a PacNet office in Ireland, and would regularly make trips to the UK and the Netherlands, where he would collect victims’ payments prom post office boxes.
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The DOJ says several people that PacNet processed payments for have already been convicted on fraud charges in the last two years.
It says each charge carries a maximum penalty of 20 years in prison.
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