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For those of us who deal with freelance foreign clients, I've heard of this company from clients, but can't figure out why it's not allowed in the United States. The reason I ask is that they advertise that they are in 200 countries - yet aren't in the largest economy in the world? That makes very little sense.

Just as a comparison, when I tried to sign up in the US, it gave me a warning that it wasn't available, yet when I choose China or Venezuela - communist countries - it's fine.

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    Being available in other countries has little bearing on being available in the US. It would like be much more expensive and complicated to work in the US because here we have a lot more regulations and requirements than say Venezuela. – Reinstate Monica Nov 12 '15 at 14:54
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    I'm wary of their claim of "200 countries". Given that there are only 193 UN-recognized countries in the world (plus 2 observer nations), that seems like a bit of an exaggeration. There are of course other disputed nations that aren't fully recognized which would bring the total over 200, but that's a technicality. It's still a pretty bold claim to say they are supported by basically every country in the world (including ones that don't exist?) – Darrel Hoffman Nov 12 '15 at 15:09
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    Perhaps the problem for OkPay is current US legislation. There are laws preventing movement of money to and from internet gaming/gambling sites UIGEA en.wikipedia.org/wiki/… . The penalties for parcipating in movement of money are quite steep and the legal costs in US are worse. It might be that OkPay (and the banks they are using) just do not want to risk anything. – Bent Nov 12 '15 at 15:15
  • Why does the map graphic on their website imply they're in the US? – Random832 Nov 12 '15 at 20:59
  • What does the fact those countries are communist have to do with anything? – user253751 Nov 12 '15 at 23:27
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The U.S. requires money transfer services to be licensed under 31 USC 5330 in addition to any applicable laws at the state level. According to multiple sources online, including the thread referenced by MD-Tech's answer, OkPay either cannot or will not get a license, so they are out.

I dug on this a bit more because I thought it was interesting, and OkPay has other issues with U.S. and other regulators related to its interaction with Bitcoins, which themselves are a hot potato for regulation right now and may explain the licensing problem. It seems to also be facing regulatory pressure in other countries, by the way, so it's not strictly a problem they face in the U.S. Just for whatever reason, the problem is greater here. Some interesting summary points:

With mounting pressure on online money exchanges from US regulators, payments processor OKPay has announced that it is suspending processing for all Bitcoin exchanges, including industry leader Mt. Gox.

...

Earlier this month, the US Department of Homeland Security seized Mt. Gox's account with mobile payment processor Dwolla, on allegations that the account was in violation of US Code 18 USC § 1960 by operating an "unlicensed money transmitting business."

Just where the Bitcoin market falls under US law is unclear, because the legality of Bitcoin transactions has yet to be tried in court and law enforcement has refused to comment on ongoing investigations, such as the Dwolla case.

http://www.theregister.co.uk/2013/05/29/okpay_suspends_bitcoin_processing/

In March, the US Treasury said any firms dealing in the virtual currency would be considered "money services businesses" just like any other, which means they must hand over transaction information to the government and work to prevent money laundering.

http://www.theregister.co.uk/2013/05/15/mt_gox_us_court/

In the UK, it apparently has also had trouble with banking partners (quoting a OkPay official regarding changing bank providers):

The UK bank that we used before did not make a final decision on whether to handle transactions in favour of crypto-currencies or not. Therefore the compliance department of the bank asked us to restrict such transfers.

This apparently allowed them to reverse a policy in the UK:

OKPAY's policy shift comes just months after it stipulated that GBP users check a box, verifying that their funds would not be spent on cryptocurrency, a feature that further incited users.

http://www.coindesk.com/okpay-gbp-bitcoin-transactions/

I hadn't heard of this company prior to your question, but having done some research, I tend to think that at least the part of this quote about language, attributed to a user, is true:

OKPAY are quite paranoid about AML and another problem is that their support people seem to be very bad at English, so their replies are often hard to understand. Their support are also slow [sic]. However in my experience they are an honest company.

I found at least one case where rumors that the entire company were going to shut down were traced back to a poorly translated message issued by the company.

Again, I know only what I read just now about this company, but it looked like there were a few red flags - the problems with the US probably not being the most important. This type of service is probably part of the future, but I'm not sure that I'd send money through it now in its current state or organization and regulation.

  • I don't agree with your answer since VISA and Mastercard work with OkPay and they generally don't work with scams. However, you took some time to research your conclusion and have supported your opinion well, so I appreciate you digging through what you found. Thanks! – user541852587 Nov 14 '15 at 17:10
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    There's a difference between "unlicensed" and a scam, of course. And also a difference between "company that I'd like to do business with" and a scam. I didn't mean to say or imply that I think that OkPay is a scam. Just that they have some regulatory hurdles and that those hurdles are significant enough that I personally would hesitate to use them. Not included in my answer, for example: When they stopped working with Mt Gox they ended up unable to directly refund customers some of their holdings under court order in the BVI. Not a scam b/c the court ordered, but also probably not great. – user32479 Nov 14 '15 at 18:36
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according to their client services it is a licensing issue: Thread: OKpay didn't Accept USA clients? They do not elaborate but do suggest that they don't plan to fix that issue.

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If you read the link that MD-Tech provided, it actually indicates that the foreign companies (mostly banks) are choosing not to work with the United States in their latest answer, so it looks like it's not OkPay, but the financial companies that they use.

On further research, the reason that this is banned is to prevent capital flight in the future. OkPay offers may ways to transfer funds in and out, such as traditional credit cards, like VISA and MasterCard, and other non-traditional ways, such as crypto-coins.

Here is another example of how the US government is limiting what US consumers can do with their money. Apparently while no one was looking in 2010, they were able to pass some new restrictions.

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    I strongly echo the sentiment in the last sentence. Initially I'd assumed it was just a case of OKPay itself not being willing (due to costs)/able to meet US anti-money laundering/terror funding rules that require knowing who all their users are. If it's actually the banks on their backend that don't have access to US financial markets that's really surprising. I suppose it's possible they're just using really small banks with limited international exposure; but would worry that they're using sketchy banks that are blacklisted in the US. – Dan Neely Nov 12 '15 at 15:30
  • I don't see this in the link. The closest that I see is this: "Our financial partners (Banks) are not going to resume work with the U.S. citizens in the nearest future." That seems very different than your statement that foreign companies won't work with the US. The problem is for the banks to work as an intermediate between OkPay and U.S. citizens, which, by it's own statements, appears not to have met the licensing requirements in the U.S. – user32479 Nov 13 '15 at 15:09
  • It well could be that OkPay prefers to work with countries that the US wouldn't allow it to work with - Iran, North Korea, etc. – Joe Nov 13 '15 at 15:29
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Here's the real reason OKPay (actually the banks they interface with) won't accept US Citizens.

The Foreign Account Tax Compliance Act Congress passed the Foreign Account Tax Compliance Act (FATCA) in 2010 without much fanfare. One reason the act was so quiet was its four-year long ramp up; FATCA did not really take effect until 2014. Never before had a single national government attempted, and so far succeeded in, forcing compliance standards on banks across the world.

FATCA requires any non-U.S. bank to report accounts held by American citizens worth over $50,000 or else be subject to 30% withholding penalties and possible exclusion from U.S. markets. By mid-2015, more than 100,000 foreign entities had agreed to share financial information with the IRS. Even Russia and China agreed to FATCA. The only major global economy to fight the Feds is Canada; however it was private citizens, not the Canadian government, who filed suit to block FATCA under the International Governmental Agreement clause making it illegal to turn over private bank account information.

Read more: The Tax Implications of Opening a Foreign Bank Account | Investopedia http://www.investopedia.com/articles/personal-finance/102915/tax-implications-opening-foreign-bank-account.asp#ixzz4TzEck9Yo Follow us: Investopedia on Facebook

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