What we have discovered is that there are an additional 6,000-10,000 merchants that are out there online accepting cards and sending transaction data through one or more of the acquirer’s portfolios. The acquirer is processing 10,000 more merchants and they don’t know who they are. They can be anyone. The acquirer is completely unaware of the significance of these transactions.That’s from Ron Teicher, CEO of Evercompliant, an Israeli company that focused on transaction laundering detection and prevention.It is a startling statistic. Notably it suggests anti-money laundering (AML) and know-your-customer (KYC) regulations brought in post-crisis may have been entirely ineffective. And, of course, that criminals have an endless capacity to adapt.The scam is simple. Rather than setting up bricks and mortar front businesses to launder profits from illicit activities, those who peddle illegal goods — from drugs to weapons and gambling services — set up fake web stores that appear to sell legitimate goods instead. (The more virtual those fake goods are, the better and easier for them.) These fake stores are then onboarded onto merchant processor systems and used as fronts to process entirely illegal transactions through. Technically, customers provide credit card authorisation details to the illegal stores, but these are transferred over to the fake sites for processing.
Izabella Kaminska considers the following as important: Uncategorised
This could be interesting, too:
Alexandra Scaggs writes Crypto money-laundering bust alert [siren]
Izabella Kaminska writes Bitcoin’s fractioning problem
Chris Nuttall writes FT Opening Quote – Let the star content wars begin
Paul Murphy writes Further reading
What we have discovered is that there are an...