On November 21, the Consumer Financial Protection Bureau filed a lawsuit in a Maryland federal court against Access Funding, a company that purchases structured settlement payments in exchange for a discounted lump sum. The Bureau also sued the company’s Chief Executive Officer, Chief Operating Officer, and an outside attorney who provided “independent professional advice” to
FTC Alleges Prepaid Card Company Deceptively Marketed Reloadable Debit Cards
On November 10, the Federal Trade Commission filed a complaint in the Northern District of Georgia against NetSpend Corporation, alleging that the company repeatedly deceived consumers about their ability to access funds deposited on the company’s debit cards.
NetSpend markets, sells, and services prepaid debit cards, including general purpose reloadable cards. According
CFPB to Publish Public List of Companies Offering Free Credit Scores
The CFPB has announced plans to produce a list of companies offering existing customers free access to their credit score. According to the CFPB, “educating and empowering consumers to take more control over their financial lives” constitutes a core part of the Bureau’s mission. Credit scores are vitally important to the Bureau in this regard
Join Us at the Third Party Payment Processors Association Executive Summit
We are pleased to announce that Troutman Sanders partners Keith Barnett and Ashley Taylor will be featured speakers at the annual Third Party Payment Processors Association (TPPPA) Executive Summit on November 9-11 at the Phoenician in Scottsdale, Arizona.
Keith and Ashley will provide an update on the legal and regulatory environment in the payment processing
Motion for Class Certification Filed Against Costco in FCRA Lawsuit
On October 12, the named plaintiff in a Fair Credit Reporting Act class action asked the Northern District of Illinois to certify her putative class against Costco Wholesale Corporation.
According to the Complaint, the plaintiff used her credit card to make a purchase at one of Costco’s stores in January 2016. By the time she
OFAC Noncompliance Leads to Big Risks for TPPP
Government agencies continue to scrutinize third-party payment processors for high-risk transactions and, when appropriate, respond to alleged violations with investigations and enforcement actions. Industry members are most likely familiar with the numerous enforcement actions brought in recent years by the Federal Trade Commission, the Consumer Financial Protection Bureau, and the Department of Justice. Recently, however,
Payment Card Industry Security Standards Council Announces New Protections for Payment Devices
The Security Standards Council of the Payment Card Industry (“PCI”) announced updates to its payment device standard, which will enable stronger protections for cardholder data, including data such as cardholders’ personal identification numbers (PINs) and cardholder data stored on the magnetic stripe of cards or on mobile devices. The updated standard addresses the increased threats
CFPB Issues Final Prepaid Card Rule
On October 5, the Consumer Financial Protection Bureau issued its much anticipated final rules regulating prepaid card accounts. The final rules follow the proposed rules that the Bureau issued in December 2014, and are mostly unchanged from the proposed rules. The new rules apply to “prepaid accounts,” which the Bureau defines as accounts that are
Getting Your Legal House in Order: Key Considerations for Selling Your Payment Processing Business
Current mergers and acquisitions (M&A) activity in the payment processing and broader fintech sectors is robust. Private equity sponsors and other financial investors are often attracted to payment processing companies with recurring cash flow streams and relatively low overhead. Strategic buyers in this industry are usually interested in acquiring new customer relationships and complementary product
Supreme Court Agrees to Hear Case That Will Affect New York and Other State Laws Concerning Credit Card Surcharges
On September 29, the United States Supreme Court agreed to hear the appeal of a case that retail merchants filed against the State of New York and City of New York challenging the constitutionality of a state law prohibiting merchants from assessing surcharges against customers who make purchases using a credit card. The challenged law