UPDATE: Funds and operations slowly kicked back into gear in the first two weeks of July. But folks are still wary of using the provider.
Payoneer has no control over the funds of its hundreds of thousands of users and has simply allowed tens of millions of dollars to be frozen overnight. That’s thanks to the company’s decision to have all its cards issued by Wirecard without having protections for their client’s funds.
Wirecard has simply lost $2 billion dollars. They have actually said, it may not have even existed. It’s fascinating that a person making $40,000 – $50,000 can be punished for losing track of a few hundred dollars during tax time, while a billion-dollar company can slide through audits with a fake $2 billion on their books.
Although Payoneer has not been given too much attention in the news, it’s cards are issued by Wirecard Card Solutions in the UK. If you go to Payoneer’s site, it looks like business as usual. But it’s not.
The money of Payoneer users around the globe is frozen and the company has said they have no control of that. So if you receive payments to a Payoneer account, make sure you stop them immediately. And if you are considering utilizing Payoneer because their website looks nice and shiny, don’t.
Payoneer officials initially said they were not impacted by Wirecard’s fraud investigation. But that changed on January 26 when they announced that millions of Payoneer users could not access their hard-earned money.
Payoneer has also said, that the funds on the cards do not belong to them and therefore they have no ability to move them for you.
This freezing is a result of the UK Financial Conduct Authority (FCA) stopping the activities of Wirecard Card Solutions UK, which distributes Payoneer’s cards around the world.
The FCA has provided the following update:
Following last week’s news of €1.9 billion missing from the accounts of the German company, Wirecard, we placed requirements on the firm’s UK business so that it should stop carrying out regulated activities and not pay out or reduce any money it holds. Our primary objective all along has been to protect the interests and money of consumers who use Wirecard.
Teams from across the FCA have been working with the firm, and other international and UK authorities, over the weekend, and we have seen good progress by the firm in meeting the conditions we set.
We are maintaining pressure on the firm to resolve these issues which would allow it to operate under certain conditions. However, we cannot lift the restrictions without reassuring ourselves that the firm has been able to satisfy all our concerns for example that all clients’ money is safe. We hope to be able to issue an update soon.
Despite Wirecard filing insolvency, they also announced they will continue operating. So as usual, it’s hard-working users feeling the PAIN while the people at the top utilize the millions of dollars they stole to bail themselves out of jail and return to the comfort of their estates… jets… yachts…
Fintech is clearly not as reliable as the world was becoming to believe before this Wirecard scandal. Perhaps it’s a much-needed wake-up call.