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Finding unregulated payment providers services
Executive summary
Unregulated payment providers — firms or intermediaries operating payment rails or conversion services without formal licensing — are a growing focus of regulators because they can enable fraud, money-movement opacity, and consumer harms (CFPB rulemaking and industry analysis) [1][2]. Investigations such as OCCRP’s “Scam Empire” show how shadow PSP-like networks, shell companies and proxy accounts have been used to siphon millions, while regulators in the U.S., UK and EU are moving to extend supervision and consumer protections to previously unregulated payment mechanisms [3][2][4].
1. Shadow payments: How unregulated “PSPs” appear in real-world scams
Reporting by the Organized Crime and Corruption Reporting Project (OCCRP) details a “huge, shadowy ecosystem” of unregulated payment service providers and intermediary firms that allowed scammers to collect and move victim funds into bank accounts and crypto, often using shell entities, proxy account holders, and vague invoicing that obscured the trail [3]. OCCRP’s leak-based reporting connects those structures directly to tens of millions reportedly extracted by call-center operations between 2022 and 2025, illustrating how payment plumbing without transparency or licensing becomes a facilitator of large-scale fraud [3].
2. Regulators’ response: tightening oversight in multiple jurisdictions
Regulators are reacting. In the U.S., the Consumer Financial Protection Bureau (CFPB) has launched rulemaking and supervisory initiatives aimed at bringing digital payment apps and large nonbank payment providers under federal consumer-protection laws, including the Electronic Fund Transfer Act and privacy rules — moves designed to reduce consumer exposure to unregulated players [1][2]. The UK and EU are also moving: Britain announced plans to regulate buy‑now‑pay‑later (BNPL) lenders and require affordability checks and quicker refunds, addressing a sector long described as “largely unregulated” [4]. Payments authorities and trade bodies are mapping further reforms across instant payments, stablecoins and PSP authorisation [5][6].
3. Why “unregulated” is not always illegitimate — but it’s risky
Not every entity outside a narrow licensing box is malicious. Some fintechs and infrastructure providers historically operated in regulatory grey zones while innovating payment experiences. But legal and compliance commentators warn that partnering with unregulated payment and trading providers amplifies operational, reputational, and regulatory risk — especially where anti-fraud controls, reporting transparency, and strong authentication are lacking [6][7]. Industry roadmaps and PSD3/PSR proposals also signal that many of these previously unregulated business models are likely to be pulled into formal regimes [8][5].
4. What investigators found when they “followed the money”
OCCRP’s investigation shows practical techniques used to hide flows: victim funds routed into legitimate banks via proxy-owned companies, mixing of unrelated victim receipts, and back-to-back invoice chains for vague services that made forensic tracing extremely difficult [3]. Those mechanics underscore why traditional bank-centric controls alone were insufficient and why authorities are pushing for broader oversight of digital payment mechanisms [3][1].
5. The policy debate: consumer protection vs. innovation and jurisdictional complexity
Law firms and trade press lay out a tension: regulators (CFPB, PSR proposals, national finance ministries) want consumer safeguards, dispute rights and supervision; industry groups warn that heavy-handed or unclear rules could stifle innovation and create compliance costs [1][9][10]. The legal commentaries note that final outcomes will depend on rule design, implementation timelines, and cross-border coordination — a complicating factor because payment flows routinely cross legal regimes [1][5].
6. Practical takeaways for companies and consumers
Companies seeking payment partners should require strong AML/KYC, multi-factor authentication, encryption, clear reporting, and formal legal status — and treat ties to unregulated intermediaries as material outsourcing that must be controlled [6][7]. Consumers should exercise caution with unfamiliar payment mechanisms, monitor statements, and rely on regulated options where dispute and refund rights are explicit; regulators are expanding those rights to more digital payments [2][4].
7. Limits of current reporting and outstanding questions
Available sources document major investigative cases and regulatory proposals, but they do not provide exhaustive lists of every unregulated provider or a uniform global definition of “unregulated payment provider” — that variation is precisely why rulemaking is active [3][1]. Sources also do not settle the optimal balance between innovation and oversight — the debates remain live in court challenges and consultations [9][1].
Bottom line: watchdog reporting shows unregulated payment intermediaries have been exploited at scale [3], and regulators in the U.S., UK and EU are actively extending supervision and consumer protections to close gaps [1][2][4]. Companies and consumers should assume the landscape will tighten and prioritize partners with transparent controls and clear regulatory footing [6][8].