DOJ Investigates Paxful Founder Ray Youssef Over AML Allegations

[kevin1]

Ray Youssef, founder of NoOnes and co-founder of Paxful, is under investigation by the US Department of Justice over allegations that Paxful operated without proper licensing and failed to maintain adequate anti-money laundering controls before shutting down in 2025. Federal prosecutors filed charges in the Eastern District of California, claiming the platform lacked sufficient Know Your Customer procedures and did not file required Suspicious Activity Reports.

The indictment also alleges Paxful facilitated Bitcoin transactions connected to unlawful online enterprises, including transfers linked to Backpage, a platform previously accused of hosting illegal commercial sex advertising. Prosecutors cited specific wallet transactions and alleged that Paxful embedded a “Pay with Paxful” feature on Backpage, enabling users to purchase Bitcoin and pay for ads. Youssef has publicly rejected the charges, describing them as part of a broader “war on crypto.”

[cryptobro]

pay with paxful on backpage now officially a crime story for law textbooks