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The Financial Conduct Authority (FCA) imposed limitations on the activities of Dzing Finance days before an authorised push payment (APP) fraud report revealed the high volume of scam transactions at the firm.
As of Friday (October 27), Dzing Finance has had restrictions placed on it by the FCA.
According to the notice, Dzing Finance has agreed to not onboard any new retail customers without prior written consent of the FCA and to stop existing retail clients from depositing new funds into their e-money wallets.
Dzing Finance has had an e-money licence in the UK since July 2019.
On its website, it describes itself as a "fast-growing neobank and banking-as-a-service platform”.
It brags about the fact that customers can “open a digital account in a matter of minutes and have all financial services with a touch of a button”.
“Our mission is to bring a better finance from our professional team to all the people to make Payments and Fintech truly accessible and global,” the company’s website says.
However, Dzing Finance has recently found itself in the middle of scandals.
Earlier this week, the Payment Systems Regulator (PSR) released its first report on APP fraud in the UK. Dzing Finance is not a directed institution, so did not have to submit information to the PSR.
However, the PSR revealed that the volume of APP fraud received per million transactions at Dzing Finance in 2022 was 187,695, topping the board.
The company that came in second highest was Prepaid Financial, at a relatively meagre 7,608.
Meanwhile, in May, Bloomberg reported allegations surrounding Dzing Finance director Mikhail Nadel.
Israel-based Nadel, who uses the alias of Stroganov, is a former banker once accused of looting Kyrgyzstan’s biggest lender, Asia Universal Bank.
Bloomberg reported that in 2021, Nadel borrowed millions from an entity backed by the family of Oleg Boyko, a Russian businessperson who was previously described in a US Senate Intelligence Committee report as having “concerning ties” to the Russian state and criminality.
Vixio reached out to Dzing Finance and Mikhail Nadel for comment prior to publication.
