$10M PacNet settlement the largest civil forfeiture in B.C. history, Farnworth says

The B.C. government announced the largest civil forfeiture in the province's history Tuesday, but the company involved maintains it did nothing wrong, and only settled the case to spare its "innocent employees" and their families from the stress of a trial.

B.C.'s Civil Forfeiture Office has agreed to the settlement with PacNet Services Ltd., which will see the company forfeit $10 million.

In a statement announcing the agreement Tuesday, B.C. Public Safety Minister and Solicitor General Mike Farnworth described PacNet as "a money-service business that was headquartered in B.C. and provided payment-processing services, including to individuals found guilty of or alleged to be running fraudulent scams against vulnerable seniors and other persons in Canada and around the world."

The settlement agreement stipulates that "there has been no admission or finding of unlawful activity" on the part of PacNet or its principals, according to the province.

In a statement on its website, PacNet says the agreement was reached on Sept. 22. 

"PacNet was ready to proceed to trial as scheduled on (Oct. 30, 2023)," the statement reads. "This settlement avoids the stress and devastating effect on the innocent employees involved and their families of the trial, which would have run until March 2024. This is why PacNet chose to settle the case, combined with the ongoing massive legal costs of continuing the proceedings."

PacNet's statement also notes that B.C.'s Director of Civil Forfeiture had been pursuing the company's corporate assets and some personal assets of former employees – including homes and retirement accounts – for "almost six years."

"Their assets in British Columbia were frozen for the duration of this case," the statement reads. "This is despite the fact there are no criminal charges against PacNet anywhere in the world, and the company's former employees have vigorously denied all the allegations against them."

The allegations those former employees deny include criminal charges of conspiracy to commit mail and wire fraud in the United States District Court of Nevada.

Several former PacNet clients have been convicted of similar charges in the U.S. since 2018, according to a recent B.C. Court of Appeal decision. 

The events that led to the civil forfeiture proceeding against PacNet began in 2016, when the U.S. Department of Justice accused the Vancouver-based company of being part of a "significant transnational criminal organization," with a nearly 20-year history of "knowingly" processing payments related to scams. 

U.S. authorities alleged that PacNet functioned as a "middle man" between mail scammers and their victims, obscuring the link between the two parties through its payment processing.

The company's website says it has not offered payment services since September 2016. Today, the site is dedicated to PacNet's attempts to defend itself against the allegations it faces.