[Paymex] Was Paymex Trading insolvent?

[Steve Amstad]

That makes for great reading.

How on earth can someone put through 100K however, without that raising some
concerns at PayMex?

Steve

-----Original Message-----
From: paymex-bounces at listserver.123.net.nz
[mailto:paymex-bounces at listserver.123.net.nz] On Behalf Of Globespec
Sent: 26 September 2008 11:42
To: paymex at listserver.123.net.nz
Subject: [Paymex] Was Paymex Trading insolvent?

Hi Guys

I am not to up with the play with all the legal ramifications, but one of my
customers who has been effected has suggested 

"Paymex continued taking money (trading insolvent - which means you can take
legal action against them if they have folded as trading insolvent is
illegal)."

Any thoughts??

------------------------------------------------------------------------

Comments: Hi 

One of the merchants who also deals with paymex talked to liquidators and
they had said that the business model paymex has used was a bit dodgy cause
these systems are meant to be setup as trust accounts with firewalls for
money etc. 

Instead what happened was it wasn\'t and all the merchants (yourself) money
goes into one account that you guys draw on.

So all money in, and out just sits in one unsecured account.
Then what happened was that a paymex merchant defrauded someone for about
100 thousand dollars or something and Visa took the money back from paymex,
but paymex was unable to recover from merchant.
Thus putting them in debt. 

Paymex continued taking money (trading insolvent - which means you can take
legal action against them if they have folded as trading insolvent is
illegal).

So essentially the whole reason for problem is that paymex has a poor
unprotected business model and all the merchants have been stung by this, as
when things went sour the money is all sitting there and although there is
35,000 in the bank account, they owe 50000 to merchants.

I believe that paymex\'s reputation will be so shot after this that anyone
trading under there name will not be likely to be able to get off the ground
again (if this indeed was their business model).

True systems like this are meant to be in escrue (spelling ? not sure)
accounts or something which are firewalled against visa taking other peoples
money back etc, and so that the company cannot touch it.

Instead this company sounds like they have set it up just as a normal bank
account with BNZ.



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