Concord Bank might have participated in questionable operations of Russian cryptocurrency exchange services Exmo and Suex. Last week, the latter company was sanctioned by the U.S. on suspicion of financing hacker groups.
The bank from Dnipro became the subject of publications in Russian media (Kommersant, The Bell) along with the Russian-Czech exchange Exmo and Moscow’s cryptocurrency exchange service Suex, following reports by the local movement "Stopnarkotik". Activists turned to law enforcement agencies, alleging that Concord supposedly provided acquiring services for payments in favor of the Russian drug trading marketplace Hydra.
“Transactions for purchasing cryptocurrency in hryvnias in Ukraine through Exmo exchange and through Concord bank acquiring,” the organization’s press service told Forbes. Stopnarkotik did not provide supporting documents. According to the Russian "Kommersant", the movement demands that the Central Bank of Russia and law enforcement agencies “block payments in favor of the Ukrainian financial institution.”
Another participant in the payment scheme that Stopnarkotik mentions 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 Virgin Islands company Hotpay and payment service Easy Transfer might have been involved in the operations in Ukraine. The latter does indeed collaborate with Concord bank, providing it, as well as PUMB bank and the financial company "Hunter," with payment infrastructure operator services.
How could the roles of the potential participants in operations for Hydra have been distributed?
Suex is a service for converting cryptocurrency into traditional money and vice versa. Since its foundation in 2018, Suex has converted cryptocurrency worth hundreds of millions of dollars, mainly in bitcoin, Ethereum, and Tether, with most of the funds coming from illegal sources (ransomware hackers, financial pyramids, drug trade) — about $370 million, writes the Russian edition The Bell, citing data from the analytical company Eliptic.
On September 21, the U.S. imposed sanctions against Suex, suspecting the platform of facilitating financial operations of hackers specializing in extortion through ransomware.
Exmo is one of the largest cryptocurrency exchanges in Eastern Europe. Unlike Suex, which specializes in withdrawing money from cryptocurrency wallets and back, Exmo provides cryptocurrency exchange between users. The service is indeed used for drug supply payments — similar cases have been established, among others, by Ukrainian cyber police.
Suex and Exmo have common roots. The cryptocurrency exchange was founded by Russian entrepreneur Ivan Petukhovskiy, who is also one of the co-investors of Suex, along with his namesake Yegor Petukhovskiy, as well as Maxim Subbotin and Ildar Zakirov, notes The Bell. After the U.S. sanctions announcement against Suex, Exmo declared that it has no connection with the crypto-exchanger. The exchange also denies any connection with Concord bank, writes the Russian edition RBC.
How could the bank have participated in questionable operations of Russians? A potential linking point could be a financial company that accepts cashless hryvnia payments for their subsequent conversion into cryptocurrency, says Forbes co-founder of the Ukrainian cryptocurrency exchange KUNA, Mykhailo Chobanyan.
“Technically, in such a situation, the bank serves the financial company’s accounts and provides it with acquiring services,” explains Chobanyan.
An interlocutor in the top management of the National Bank noted that Concord Bank has indeed increased the volume of acquiring operations. Officially, the NBU did not respond to Forbes’s request by the time of publication. The bank’s CEO, Yuriy Zadoya, declined to comment on the situation with Russian crypto services. At the time of publication, the Concord press service did not respond to Forbes’s request.
According to NBU data, apart from the bank, the “Concord” banking group includes Ukrainian financial companies “Cordpay”, “Mastpay”, “Procard” and “Syncom”, as well as non-resident companies: British Electronic Payment Solutions LTD and Maltese Moneycare Limited. The group is owned by entrepreneurs from Dnipro Olena Sosyedka and Yuliya Sosyedka (56.2% and 43.8% of shares, respectively).