Ontario court dismisses claim against UK e-payment company accused of involvement in crypto scheme

In a claim that a trader lost six bitcoins due to the bankruptcy of DSX Global (UK) Limited, which was allegedly part of a scheme involving a crypto asset trading platform, the Ontario Superior Court dismissed the action against one defendant for lack of jurisdiction. 

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In Iakovlev v. Epayments Systems Ltd., 2026 ONSC 1296, the plaintiff sought damages based on misrepresentation and civil conspiracy. He alleged the following in his amended statement of claim: 

• In October 2017, to open an account with DSX Global, the plaintiff gave DSX Global’s crypto asset trading platform the information needed to register, including official documents confirming his Ontario residency. DSX Global and its platform had no registration to operate in Canada. 
• ePayments Systems Limited, a UK-based digital payment company closely integrated with DSX Global, agreed to provide crypto asset trading services within the plaintiff’s jurisdiction. 
• Based on the defendants’ scheme, which involved holding out the platform as a fully compliant and regulated crypto asset trading platform, the plaintiff deposited fiat currency via ePayments to purchase bitcoins, then held in his DSX Global account. 
• The defendants, which participated in and assisted with the scheme, were liable for civil conspiracy. Acting illegally in Canada, they breached Canadian anti-money laundering laws, securities laws, and other regulations. 
• The defendants made representations while knowing they were false, or made them without believing they were true, or made them recklessly without caring about their truth or falsity. These representations induced users to get into the scheme and led them to transfer and exchange funds on the platform. 
• ePayments contributed to the scheme by allowing the plaintiff’s onboarding onto the platform even though he was not living in a jurisdiction in which the platform could operate, by accepting funds via its website and arranging their transfer onto the platform through an account made by a Canadian resident, and by letting its organization closely interrelate and integrate with the platform, thus lending the platform a false sense of legitimacy. 
• Due to the defendants’ actions and representations, the plaintiff purchased bitcoins via ePayments and the platform. DSX Global’s bankruptcy then deprived him of six bitcoins. 
• At all relevant times, the plaintiff could access the platform’s website via the IP address linked to his Toronto home, disclosed to the defendants all his pertinent residency details, and obtained the platform’s approval to acquire and trade crypto from his Toronto home. 

No jurisdiction found

In response to the allegations in the plaintiff’s claim, the defendant ePayments moved to dismiss the plaintiff’s claim against it. ePayments argued that the Ontario court had no jurisdiction over it or that Ontario was forum non conveniens. 

Granting ePayments’ motion, the Ontario Superior Court of Justice dismissed the plaintiff’s action against it for lack of jurisdiction. The court ordered the plaintiff to pay ePayments the motion’s costs of $25,000, including disbursements and taxes. 

The court ruled that it lacked presence-based or consent-based jurisdiction over ePayments and lacked a basis to assume jurisdiction over the foreign defendant. 

Regarding presence‑based jurisdiction, the court explained that ePayments did not carry on business in Ontario (including for the purposes of establishing assumed jurisdiction), gather information or data in Ontario, or use targeted advertising in Ontario. 

The court added that permitting the plaintiff and other users to register with ePayments, navigate its website, and access their accounts globally did not constitute carrying on business in Ontario. 

Regarding consent‑based jurisdiction, the court pointed out that ePayments did not attorn to the jurisdiction of the province’s courts, and that the plaintiff did not assert such jurisdiction in the claim. 

Next, the court discussed assumed jurisdiction. First, regarding the alleged fraudulent or negligent misrepresentation, the court saw no good, arguable case that ePayments committed a misrepresentation-based tort in Ontario, such that the court could assume jurisdiction over the foreign defendant. 

Based on the pleadings and evidence, the court could not find or infer that the plaintiff was in Ontario when he received the alleged misrepresentations or acted on the representations. 

The court saw a basis to rebut the presumptive connecting factor in the circumstances. The court found it unreasonable for ePayments to expect the court to call it to respond to the Ontario proceedings, given the weak connection to the province. 

Regarding the civil conspiracy allegations, the court likewise determined that the plaintiff failed to establish a presumptive connecting factor. 

“In my view, the plaintiff’s evidence about damages suffered in Ontario is extremely vague and fails to connect the alleged losses to Ontario,” wrote Associate Justice Robert Frank. “It does not include any direct or specific evidence of any bank account, investment account, RRSP account, or other asset in Ontario or elsewhere in Canada from which any funds were taken or derived and then used in connection with the impugned transactions.” 

The court added that, even if the plaintiff had used funds originating in Ontario to buy the allegedly lost bitcoins, servers in the European Union were holding his digital assets. 

Considering its conclusion that it lacked jurisdiction simpliciter over ePayments, the court did not find it necessary to consider ePayments’ alternative argument that Ontario was forum non conveniens.