Aussie tech unicorn Airwallex says it is cooperating with Hong Kong police after the authorities froze $US18 million ($26 million) of its funds over suspected fraudulent transactions.
In a statement on Tuesday, the payments company said it was an innocent third party in the proceedings after two former clients allegedly defrauded Uruguayan company Ciklus.
“Since being informed of the fraud, we have been cooperating and assisting the police,” Airwallex said. “The incident has had no impact on the viability or operations of our business.”
The startup, which investors touted as a critical disruptor in the financial services sector and reached a $US1 billion valuation in March, is a global payments provider.
Airwallex – which enables clients to set up foreign currency accounts and send funds to 130 countries – says it conducted proper “Know Your Customer” procedures on the two clients.
The pair, known as Rong Tong and Zhong Liang, allegedly defrauded Ciklus in April without the knowledge of the startup.
“These two former clients used their Airwallex accounts to receive and pay out the funds from Ciklus,” Airwallex said. “[Airwallex was] not involved in nor aware of the fraud.”
“Police … issued a letter of no-consent to our banks, requesting that certain funds in our account were not to be dealt with until the police have completed their investigation.
“We have been cooperating and assisting the police in their investigation of the matter and are in frequent discussions with the police regarding the lifting of the letter of no-consent,” the company said.
This story originally appeared in the Australian Financial Review. Read the original story here.
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