Payments Law
Payments law stretches back to ancient times. Contemporary applications permit for rapid authentication, communication and exchange, thereby multiplying the variety of viable payments business models. In the unregulated segments of the payments marketplace, parties turn to the firm for support on traditional issues such as allocation of risk, limitation of liability, and residual stream protection. Whether the model is based on traditional credit card acquiring, a mobile virtual currency, novel gift credit networks, or any other entitlement system, it can benefit from previous experience of the firm. All manner of payment systems require legal framing so as to protect the value of the business and maximize profits.
ISO / Agent Agreements
Banks have opted to outsource the business of recruiting new merchants to offer them credit card and debit card processing services. Independent Sales Organizations (ISO) and Independent Sales Representatives (ISR) enter into agreements with processors and banks to recruit new merchants. The firm advises on about one hundred such relationships per year. The advice includes negotiating key processor agreements, drafting agent and referral agreements, advising on acquisitions and financing as well as support in disputes. The firm has cultivated strong relationships working opposite all major US acquiring processors and banks and leverages those relationships to provide practical and efficient advice for ISOs and ISRs.
MSB Licensing and Compliance
FinCEN and State Registration of MSBs
Money transmitters, foreign exchange dealers and other money services businesses (MSB) are held to a higher standard of compliance and are often required to register in the US with FinCEN as well as with state banking departments. With the advent of new applications, the obligation to register is not as obvious as it was for traditional money transmitters. Here, the firm draws on its experience advising numerous payments models, to support MSBs in sorting through registration issues. The firm powers the popular MSB Blog as part of its compliance practice.
Anti-Money Laundering (AML) Policy Drafting
AML policies are required for most MSBs, and recommended by the firm for all payments businesses so as to reduce the chance of unwittingly assisting in money laundering or the financing of terrorism. The firm regularity drafts AML policies for payments businesses. In contrast with compliance consultants that draft such policies, the firm brings its payments market experience into AML policies to taylor them to the specific risk profiles of the business model in question.
As a complement to AML policies, the firm also drafts company security policies, including those for acceptable use, backups, confidential data, data classification, email, employee screening, encryption, incident response, mobile devices, network access & authentication, network security, new account setup, outsourcing, passwords, physical security, remote access, retention, and wireless access.
Payments Business Consulting
Having seen thousands of payments models, the firm takes the liberty of offering business consulting advice on how to structure new payments businesses. Basic questions as to which party should pay for a given transaction or carry the risk may be pivoted to dramatically increase the value of a business. The firm is recognized as being dramatically creative in delivering new ideas to businesses and enriching the organic evolution of clients.
MATCH / TMF Merchant Support
When merchant agreements for credit card processing are terminated for cause, for a defined list of reasons, including excessive chargebacks and other wrongdoing, the Visa Rules and Regulations and the MasterCard Rules provide for the acquiring bank to list the merchant on the Member Alert To Control High-Risk merchants list of MasterCard (MATCH List), also known as the Terminated Merchant File (TMF). While most such listings are justified, on account of serious and intentional wrongdoing by the merchants, some of them are not. Where a merchant is in good faith and has been listed on MATCH/TMF when they should not have been, the firm is pleased to provide support in attempting to have the merchant removed. The firm will not act in a matter unless it believes it can add value for the client.
The firm powers www.tmfmatch.co, as part of its MATCH/TMF support practice.
Community Service
The firm has an ongoing commitment to pro bono service. The flagship community service program of the firm is to provide free legal advice to ISO widows. As ISO owners age, their spouses are sometimes left inheriting businesses that they do not know how to operate. Widows in that situation are welcome to seek free advice on a portfolio sale or on protecting the residual streams to which they are entitled.
