Allegations of Financial Misconduct and Regulatory Evasion Surrounding Crypto Processor CoinsPaid & SoftSwiss

The CoinsPaid Group and Its Network

Recent investigative findings by Shana Dovi on Medium have unveiled serious allegations against CoinsPaid, an Austrian cryptocurrency payment processor operating under Dream Finance OÜ in Estonia. The report details a convoluted network of financial misconduct, fraud, and regulatory evasion purportedly orchestrated by the company’s management and undisclosed stakeholders. Alarmingly, the Austrian beneficial owner is reportedly acting as a front for interests linked to Belarus.

 A Snapshot of CoinsPaid

CoinsPaid functions through various legal entities in Estonia, Lithuania, and El Salvador. Its primary operating entity, Dream Finance OÜ, possesses a crypto license in Estonia and is overseen by Austrian entrepreneur Alexander Horst Riedinger, with Maksim Krupyshev serving as CEO. Another brand associated with this entity is CryptoProcessing.

 Major Allegations Against CoinsPaid

• Financial Misconduct and Bankruptcy:
  • Public acknowledgment of a €34 million loss due to a hack, contradicting earlier smaller estimates.
  • Indications of potential bankruptcy despite ongoing operations, as internal financial evaluations reveal substantial negative equity.
• Involvement in Money Laundering:
  • Accusations of laundering hundreds of millions of euros annually.
  • Operations allegedly involve a network of Belarusian expatriates, focusing on offshore and illegal gambling platforms.
  • Highlighted non-compliance with local labor and tax regulations.
• Dubious Management Practices:
  • Maksim Krupyshev, a Ukrainian crypto influencer and CEO of CoinsPaid, is accused of acting as a front for Belarusian operators.
  • Manipulation of corporate structures to facilitate financial crimes without direct corporate implications.
• Regulatory Evasion and Compliance Issues:
  • Exploitation of regulatory loopholes in Estonia and other jurisdictions.
  • Establishment of front companies to obscure operations and avoid scrutiny.
• Impact and Scope of Operations:
  • Whistleblower reports suggest broader risks to the financial system akin to previous crypto sector crises.
  • Allegations of weak regulatory oversight in Estonia, including the renewal of Dream Finance’s license despite ongoing issues.

 The Hidden Connection to AlphaPo

Shana Dovi’s investigation uncovers significant ties between CoinsPaid and another crypto payment processor, AlphaPo. These connections indicate operational and managerial overlaps, raising concerns about transparency and compliance.

 Key Points of Connection

• Shared Technology and Management:
  • Both companies utilize identical technology and share managerial staff.
• Common Compliance Department:
  • A shared compliance department raises potential conflicts of interest and confidentiality breaches.
• Simultaneous Security Breaches:
  • Both entities experienced hacks simultaneously in July 2023, suggesting deep operational integration.
• Financial Interdependence:
  • Funds and clients appear to move between CoinsPaid and AlphaPo without proper financial compensation, indicating internal management of financial flows.
• Shared Personnel and Communication Channels:
  • Personnel discussions and client onboarding decisions are made jointly via shared communication platforms.
• Fronting Allegations:
  • CoinsPaid presents itself as separate from AlphaPo in official narratives while internally acknowledging their unity.

These connections imply a deliberate effort to obscure true ownership and control, potentially facilitating unethical or illegal activities.

Key Individuals Involved

The report highlights several individuals associated with CoinsPaid and AlphaPo, suggesting their involvement in the companies’ questionable operations:

SoftSwiss and its associated entities, including CoinsPaid, AlphaPo, Merkeleon, and Dream Finance, are no strangers to allegations of money laundering, sanction evasion, and fraudulent activities. Key individuals, such as Ivan Montik, Max Krupyshev, Pavel Kashuba, Dmitry Yaikov, Roland Yakovlevich Isaev, and Paata Gamgoneishvili, Maksim Trafimovich are at the center of these controversies.

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