Key Data
- Trading Name: Papaya Ltd.
- Legal Entity: Papaya Ltd.
- Activities: EMI
- Location: Malta
- Regulations: Licensed by the Malta Financial Services Authority as an EMI
- Key People:Dmitrijs Panurskis
- Latest news: Papaya
Overview of Papaya Ltd. and Blackcatcard
Papaya Ltd., a fintech based in Malta, operates as an Electronic Money Institution (EMI) licensed by the Malta Financial Services Authority (MFSA). Its flagship product, the co-branded payment card “Blackcatcard,” offers mobile and online banking services, including free European IBANs, multiple payment cards, and cryptocurrency support. The company serves both individual users and businesses, offering a broad range of financial solutions.
However, Papaya Ltd. has come under scrutiny due to potential regulatory issues, allegations of concealed ownership, and concerns related to financial misconduct, particularly linked to Ilya Kligman, a former Russian banker with a controversial financial background and alleged connection to the financial crime scene.
Ilya Kligman and Financial Fraud Allegations
Ilya Kligman, a Russian banker, has been implicated in several high-profile financial fraud cases involving Russian banks. Investigators have linked him to fraud schemes totaling more than 150 billion rubles ($1.5 billion). His operations reportedly involved the embezzlement of funds from various banks, such as:
- Agrosoyuz Bank: 7 billion rubles
- Interkommerts Bank: 65.1 billion rubles
- Arksbank: 35 billion rubles
- Antalbank: 14.7 billion rubles
- Baikalbank: 6 billion rubles
Kligman allegedly orchestrated fraudulent deposit schemes, known as “notebook deposits,” in which the official deposit amounts were underreported, allowing excess funds to be siphoned off for personal gain. Kligman fled to Germany in 2016, escaping legal action in Russia.
Kligman is also suspected of having a hidden beneficial interest in Papaya Ltd. despite not being the registered owner. This has raised concerns about Papaya’s regulatory compliance and the transparency of its ownership structure.
Papaya Ltd. in the Offshore Leaks Database
Papaya Ltd. was identified in the Paradise Papers investigation, part of the ICIJ Offshore Leaks Database. According to the leaked documents, Papaya Ltd. was incorporated in Malta on January 30, 2012, and has ties to various individuals and entities involved in offshore financial activities. Notable connections include:
- Istvan Burgyan: Listed as a shareholder and director in the Paradise Papers.
- Frederic Villa: Involved as a shareholder and director, among other roles.
- Tonio Fenech: Listed as a legal representative and director.
- The involvement of PricewaterhouseCoopers as the auditor is also mentioned in the Paradise Papers records. The address associated with Papaya Ltd. is 114/3 The Strand, Gzira, Malta.
While inclusion in the Offshore Leaks Database does not automatically imply illegal activity, it highlights Papaya Ltd.’s presence in jurisdictions known for offshore financial practices, raising additional concerns about the company’s transparency and governance.
Regulatory and Compliance Challenges
Papaya Ltd. is currently under investigation by the MFSA to determine whether Kligman, despite not being officially listed as the owner, holds a controlling interest in the company. These concerns are exacerbated by Malta’s greylisting by the Financial Action Task Force (FATF) in 2021 due to deficiencies in the country’s financial oversight mechanisms.
Papaya Ltd. denies any wrongdoing and claims to be the target of a disinformation campaign to damage its reputation. However, the investigations into the company’s ownership and operations continue.
Customer Feedback and Risk Assessment
Customer reviews for Papaya Ltd. and Blackcatcard have been mixed, with both services receiving negative feedback. Papaya Ltd. has a 2.2-star rating on Google, while Blackcatcard holds a 2.6-star rating on Trustpilot. The complaints center around poor customer service and a lack of transparency.
Unresolved investigations and negative customer feedback have led to Papaya Ltd. and Blackcatcard being assigned an Orange compliance rating, which indicates a high-risk profile for potential partners and users.
Conclusion: Key Takeaways for Stakeholders
The ongoing investigations into Papaya Ltd. and Ilya Kligman raise significant concerns about the company’s regulatory compliance, ownership structure, and potential ties to financial misconduct. The presence of Papaya Ltd. in the Offshore Leaks Database further underscores the importance of transparency and proper governance.
While Papaya Ltd. maintains its operations and denies any involvement in illicit activities, the risks associated with the company remain high. Stakeholders are advised to exercise caution when considering any business relationship with Papaya Ltd. or its product, Blackcatcard.