Electronic Payment Systems, LLC; Analysis of Proposed Consent Order To Aid Public Comment, 17089-17091 [2022-06306]

Download as PDF Federal Register / Vol. 87, No. 58 / Friday, March 25, 2022 / Notices protected by restricted access procedures, including user identifications and passwords. Only FHFA staff (and FHFA contractors assisting such staff) whose official duties require access are allowed to view, administer, and control these records. Dated: March 22, 2022. William Cody, Secretary. RECORD ACCESS PROCEDURES: [Docket No. OP–1765] [FR Doc. 2022–06308 Filed 3–24–22; 8:45 am] BILLING CODE 6730–02–P FEDERAL RESERVE SYSTEM See ‘‘Notification Procedures’’ below. CONTESTING RECORD PROCEDURES: See ‘‘Notification Procedures’’ below. NOTIFICATION PROCEDURES: Individuals seeking notification of any records about themselves contained in this system should address their inquiry to the Privacy Act Officer, via email to privacy@fhfa.gov or by mail to the Federal Housing Finance Agency, 400 Seventh Street SW, Washington, DC 20219, or in accordance with the procedures set forth in 12 CFR part 1204. Please note that all mail sent to FHFA via the U.S. Postal Service is routed through a national irradiation facility, a process that may delay delivery by approximately two weeks. For any time-sensitive correspondence, please plan accordingly. EXEMPTIONS PROMULGATED FOR THE SYSTEM: None. HISTORY: The system of records was last published in full in the Federal Register at 83 FR 43677 (August 27, 2018). Clinton Jones, General Counsel, Federal Housing Finance Agency. [FR Doc. 2022–06310 Filed 3–24–22; 8:45 am] BILLING CODE 8070–01–P FEDERAL MARITIME COMMISSION lotter on DSK11XQN23PROD with NOTICES1 Notice of Intent To Terminate The Commission gives notice that it intends to terminate the following agreement pursuant to 46 CFR 501.17(h)(2) thirty days from publication of this notice. Agreement No.: 012022. Agreement Name: Discovery Cruise Line/Bernuth Lines Space Charter and Sailing Agreement. Reason for termination: Parties no longer registered Vessel Operating Common Carriers. Location: https://www2.fmc.gov/FMC. Agreements.Web/Public/ AgreementHistory/1866. VerDate Sep<11>2014 16:50 Mar 24, 2022 Jkt 256001 Framework for the Supervision of Insurance Organizations; Extension of Comment Period Board of Governors of the Federal Reserve System. ACTION: Notification of extension of comment period. AGENCY: On February 4, 2022, the Board of Governors of the Federal Reserve System (Board), published in the Federal Register a proposed supervisory framework for depository institution holding companies that are significantly engaged in insurance activities, or supervised insurance organizations. The Board has determined that an extension of the comment period until May 5, 2022, is appropriate, and is therefore making that extension. DATES: Comments must be received by May 5, 2022. ADDRESSES: You may submit comments by any of the methods identified in the proposal. FOR FURTHER INFORMATION CONTACT: Thomas Sullivan, Senior Associate Director, (202) 475–7656; Matt Walker, Manager, (202) 872–4971; Brad Roberts, Lead Insurance Policy Analyst, (202) 452–2204; or Joan Sullivan, Senior Insurance Policy Analyst, (202) 912– 4670, Division of Supervision and Regulation; or Charles Gray, Deputy General Counsel, (202) 872–7589; Andrew Hartlage, Senior Counsel, (202) 452–6483; or Christopher Danello, Senior Attorney, (202) 736–1960, Legal Division, Board of Governors of the Federal Reserve System, 20th and C Streets NW, Washington, DC 20551. For users of TTY–TRS, please call 711 from any telephone, anywhere in the United States. SUPPLEMENTARY INFORMATION: On February 4, 2022, the Board published in the Federal Register a proposed supervisory framework for depository institution holding companies that are significantly engaged in insurance activities, or supervised insurance organizations.1 The proposed framework would provide a supervisory approach that is designed specifically to SUMMARY: 1 PO 00000 87 FR 6537 (February 4, 2022). Frm 00027 Fmt 4703 Sfmt 4703 17089 reflect the differences between banking and insurance. Within the framework, the application of supervisory guidance and the assignment of supervisory resources would be based explicitly on a supervised insurance organization’s complexity and individual risk profile. The proposed framework would formalize the ratings applicable to these firms with rating definitions that reflect specific supervisory requirements and expectations. It would also emphasize the Board’s policy to rely to the fullest extent possible on work done by other relevant supervisors, describing, in particular, the way it will rely more fully on reports and other supervisory information provided by state insurance regulators to minimize the burden associated with supervisory duplication. The notice of proposed guidance stated that the comment period would close on April 5, 2022. The Board subsequently received a request to extend the comment period. An extension of the comment period will provide additional opportunity for the public to consider the proposal and prepare comments, including to address the questions posed by the Board in the proposal. Therefore, the Board is extending the end of the comment period for the proposal from April 5, 2022, to May 5, 2022. By order of the Board of Governors of the Federal Reserve System, acting through the Secretary of the Board under delegated authority, March 21, 2022. Ann E. Misback, Secretary of the Board. [FR Doc. 2022–06286 Filed 3–24–22; 8:45 am] BILLING CODE 6210–01–P FEDERAL TRADE COMMISSION [File No. X170045] Electronic Payment Systems, LLC; Analysis of Proposed Consent Order To Aid Public Comment Federal Trade Commission. Proposed consent agreement; request for comment. AGENCY: ACTION: The consent agreement in this matter settles alleged violations of federal law prohibiting unfair or deceptive acts or practices. The attached Analysis of Proposed Consent Order to Aid Public Comment describes both the allegations in the complaint and the terms of the consent order—embodied in the consent agreement—that would settle these allegations. DATES: Comments must be received on or before April 25, 2022. SUMMARY: E:\FR\FM\25MRN1.SGM 25MRN1 17090 Federal Register / Vol. 87, No. 58 / Friday, March 25, 2022 / Notices Interested parties may file comments online or on paper by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Please write ‘‘Electronic Payment Systems, LLC; File No. X170045’’ on your comment, and file your comment online at https://www.regulations.gov by following the instructions on the webbased form. If you prefer to file your comment on paper, mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC–5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. FOR FURTHER INFORMATION CONTACT: Jody Goodman (202–326–3096), Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580. SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, notice is hereby given that the above-captioned consent agreement containing a consent order to cease and desist, having been filed with and accepted, subject to final approval, by the Commission, has been placed on the public record for a period of thirty (30) days. The following Analysis to Aid Public Comment describes the terms of the consent agreement and the allegations in the complaint. An electronic copy of the full text of the consent agreement package can be obtained at https:// www.ftc.gov/news-events/commissionactions. You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before April 25, 2022. Write ‘‘Electronic Payment Systems, LLC; File No. X170045’’ on your comment. Your comment—including your name and your state—will be placed on the public record of this proceeding, including, to the extent practicable, on the https:// www.regulations.gov website. Due to the COVID–19 pandemic and the agency’s heightened security screening, postal mail addressed to the Commission will be subject to delay. We strongly encourage you to submit your comments online through the https:// www.regulations.gov website. If you prefer to file your comment on paper, write ‘‘Electronic Payment Systems, LLC; File No. X170045’’ on your comment and on the envelope, and lotter on DSK11XQN23PROD with NOTICES1 ADDRESSES: VerDate Sep<11>2014 16:50 Mar 24, 2022 Jkt 256001 mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC– 5610 (Annex D), Washington, DC 20580. If possible, submit your paper comment to the Commission by overnight service. Because your comment will be placed on the publicly accessible website at https://www.regulations.gov, you are solely responsible for making sure your comment does not include any sensitive or confidential information. In particular, your comment should not include sensitive personal information, such as your or anyone else’s Social Security number; date of birth; driver’s license number or other state identification number, or foreign country equivalent; passport number; financial account number; or credit or debit card number. You are also solely responsible for making sure your comment does not include sensitive health information, such as medical records or other individually identifiable health information. In addition, your comment should not include any ‘‘trade secret or any commercial or financial information which . . . is privileged or confidential’’—as provided by Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)— including in particular competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names. Comments containing material for which confidential treatment is requested must be filed in paper form, must be clearly labeled ‘‘Confidential,’’ and must comply with FTC Rule 4.9(c). In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c). Your comment will be kept confidential only if the General Counsel grants your request in accordance with the law and the public interest. Once your comment has been posted on the https:// www.regulations.gov website—as legally required by FTC Rule 4.9(b)—we cannot redact or remove your comment from that website, unless you submit a confidentiality request that meets the requirements for such treatment under FTC Rule 4.9(c), and the General Counsel grants that request. Visit the FTC website at http:// www.ftc.gov to read this document and the news release describing the proposed settlement. The FTC Act and other laws that the Commission PO 00000 Frm 00028 Fmt 4703 Sfmt 4703 administers permit the collection of public comments to consider and use in this proceeding, as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before April 25, 2022. For information on the Commission’s privacy policy, including routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/ privacy-policy. Analysis of Proposed Consent Order To Aid Public Comment The Federal Trade Commission (‘‘FTC’’ or ‘‘Commission’’) has accepted, subject to final approval, an agreement containing a consent order from Electronic Payment Systems, LLC, also d/b/a EPS, Electronic Payment Transfer, LLC, also d/b/a EPS, John Dorsey, and Thomas McCann (‘‘EPS’’). The Commission has placed the proposed Order on the public record for thirty days for receipt of comments by interested persons. Comments received during this period will become part of the public record. After thirty days, the Commission will again review the agreement and the comments received, and will decide whether it should withdraw from the agreement and take appropriate action or make final the agreement’s proposed Order. Respondent Electronic Payment Systems, LLC is an independent sales organization (‘‘ISO’’) that serves as an intermediary between merchants seeking to open credit card merchant accounts and its acquiring bank, which is the bank that has access to the credit card networks. John Dorsey and Thomas McCann are officers and the owners of EPS. The Commission’s proposed Complaint alleges that, in 2012 and 2013, EPS served as the ISO for the entities involved in a deceptive telemarketing scam called Money Now Funding (‘‘MNF’’ or ‘‘MNF scam’’). The FTC sued MNF in 2013 for telemarketing worthless business opportunities to consumers and falsely promising that consumers would earn thousands of dollars in income. The principals of the MNF scam went to great lengths to hide their identities behind many phony businesses. In order to charge consumers’ credit cards but make it difficult to trace the money back to MNF, MNF engaged in a credit card laundering scheme whereby its principals and employees created numerous fictitious companies. Those fictitious companies, through a sales agent, submitted applications for merchant accounts to EPS. With knowledge of the misconduct, EPS then opened merchant accounts in the names E:\FR\FM\25MRN1.SGM 25MRN1 lotter on DSK11XQN23PROD with NOTICES1 Federal Register / Vol. 87, No. 58 / Friday, March 25, 2022 / Notices of these fictitious companies, and victim credit card charges were processed through those accounts, rather than through a single merchant account in the name of MNF. With similar knowledge, EPS engaged in the underwriting and approval of MNF’s fictitious companies and submitted merchant account applications for these fictitious companies to its acquirer. Using the services of two payment processors, EPS enabled more than $4.6 million in MNF transactions to be processed through these and other fraudulent merchant accounts. The Commission’s proposed Complaint alleges that EPS’s conduct regarding the MNF fictitious companies and their merchant accounts constituted an unfair act or practice under Section 5 of the FTC Act and assistance and facilitation of illegal credit card laundering under Section 310.3(b) of the Telemarketing Sales Rule, 16 CFR 310.3(b); see also § 310.3(c) (banning credit card laundering). The proposed Order contains provisions designed to prevent EPS from engaging in the same or similar acts or practices in the future. Section I of the proposed Order contains prohibitions against engaging in credit card laundering; engaging in tactics to evade fraud monitoring or risk monitoring programs; providing payment processing services to any merchant that is engaged in any act or practice that is, or is likely to be, deceptive or unfair; and providing payment processing services to, or acting as an ISO for, any merchant that is listed on the MasterCard Member Alert to Control High-Risk Merchants (MATCH) list for several enumerated reasons. Section II imposes screening requirements that EPS must implement when it screens applications from prospective merchants that fall under the definition of ‘‘Additional Review Merchants.’’ The definition of Additional Review Merchant includes categories of EPS merchants that have been the subject of FTC cases: Merchants who engage in outbound telemarketing and merchants selling specific services (debt collection, debt relief, credit-related services, rental housing listings, job listings, or ‘‘Money Making Opportunities,’’ as defined in the order). Heightened screening of Additional Review Merchants includes obtaining detailed information about the merchant’s business, as laid out in the order. EPS would also be required to take reasonable steps to verify the accuracy of the due diligence information it obtains. VerDate Sep<11>2014 16:50 Mar 24, 2022 Jkt 256001 Section III requires increased monitoring of Additional Review Merchants. The order requires EPS to investigate merchants whose chargeback rate exceeds 1% and whose total number of chargebacks exceeds 55 per month in two of the preceding six months. Section IV requires monitoring of sales agents and termination of sales agents who are engaged in tactics to conceal credit card laundering. Sections V through IX are reporting and compliance provisions that allow the Commission to better monitor EPS’s ongoing compliance with the Order. Under Section IX, the Order will expire in twenty years, with certain exceptions. The purpose of this analysis is to aid public comment on the proposed Order. It is not intended to constitute an official interpretation of the Complaint or proposed Order, or to modify in any way the proposed Order’s terms. By direction of the Commission. April J. Tabor, Secretary. [FR Doc. 2022–06306 Filed 3–24–22; 8:45 am] BILLING CODE 6750–01–P DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services [Document Identifiers: CMS–10410, CMS– 10554 and CMS–10325] Agency Information Collection Activities: Submission for OMB Review; Comment Request Centers for Medicare & Medicaid Services, Health and Human Services (HHS). ACTION: Notice. AGENCY: The Centers for Medicare & Medicaid Services (CMS) is announcing an opportunity for the public to comment on CMS’ intention to collect information from the public. Under the Paperwork Reduction Act of 1995 (PRA), federal agencies are required to publish notice in the Federal Register concerning each proposed collection of information, including each proposed extension or reinstatement of an existing collection of information, and to allow a second opportunity for public comment on the notice. Interested persons are invited to send comments regarding the burden estimate or any other aspect of this collection of information, including the necessity and utility of the proposed information collection for the proper performance of the agency’s functions, the accuracy of SUMMARY: PO 00000 Frm 00029 Fmt 4703 Sfmt 4703 17091 the estimated burden, ways to enhance the quality, utility, and clarity of the information to be collected, and the use of automated collection techniques or other forms of information technology to minimize the information collection burden. DATES: Comments on the collection(s) of information must be received by the OMB desk officer by April 25, 2022. ADDRESSES: Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to www.reginfo.gov/public/do/ PRAMain. Find this particular information collection by selecting ‘‘Currently under 30-day Review—Open for Public Comments’’ or by using the search function. To obtain copies of a supporting statement and any related forms for the proposed collection(s) summarized in this notice, you may make your request using one of following: 1. Access CMS’ website address at website address at: https:// www.cms.gov/Regulations-andGuidance/Legislation/Paperwork ReductionActof1995/PRA-Listing.html. FOR FURTHER INFORMATION CONTACT: William Parham at (410) 786–4669. SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501–3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. The term ‘‘collection of information’’ is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires federal agencies to publish a 30-day notice in the Federal Register concerning each proposed collection of information, including each proposed extension or reinstatement of an existing collection of information, before submitting the collection to OMB for approval. To comply with this requirement, CMS is publishing this notice that summarizes the following proposed collection(s) of information for public comment: 1. Type of Information Collection Request: Extension of a currently approved collection; Title of Information Collection: Medicaid Program; Eligibility Changes under the Affordable Care Act of 2010; Use: The State Medicaid and CHIP agencies will collect all information needed to determine and redetermine eligibility for Medicaid and will transmit E:\FR\FM\25MRN1.SGM 25MRN1

Agencies

[Federal Register Volume 87, Number 58 (Friday, March 25, 2022)]
[Notices]
[Pages 17089-17091]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-06306]


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FEDERAL TRADE COMMISSION

[File No. X170045]


Electronic Payment Systems, LLC; Analysis of Proposed Consent 
Order To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement; request for comment.

-----------------------------------------------------------------------

SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis of Proposed Consent Order to Aid 
Public Comment describes both the allegations in the complaint and the 
terms of the consent order--embodied in the consent agreement--that 
would settle these allegations.

DATES: Comments must be received on or before April 25, 2022.

[[Page 17090]]


ADDRESSES: Interested parties may file comments online or on paper by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Please write ``Electronic 
Payment Systems, LLC; File No. X170045'' on your comment, and file your 
comment online at https://www.regulations.gov by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Jody Goodman (202-326-3096), Bureau of 
Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue 
NW, Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing a consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
at https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before April 25, 2022. 
Write ``Electronic Payment Systems, LLC; File No. X170045'' on your 
comment. Your comment--including your name and your state--will be 
placed on the public record of this proceeding, including, to the 
extent practicable, on the https://www.regulations.gov website.
    Due to the COVID-19 pandemic and the agency's heightened security 
screening, postal mail addressed to the Commission will be subject to 
delay. We strongly encourage you to submit your comments online through 
the https://www.regulations.gov website.
    If you prefer to file your comment on paper, write ``Electronic 
Payment Systems, LLC; File No. X170045'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex D), Washington, DC 20580. If possible, submit your paper 
comment to the Commission by overnight service.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure your comment does not include any sensitive or confidential 
information. In particular, your comment should not include sensitive 
personal information, such as your or anyone else's Social Security 
number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure your comment does not include 
sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including in particular competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the https://www.regulations.gov website--as legally 
required by FTC Rule 4.9(b)--we cannot redact or remove your comment 
from that website, unless you submit a confidentiality request that 
meets the requirements for such treatment under FTC Rule 4.9(c), and 
the General Counsel grants that request.
    Visit the FTC website at http://www.ftc.gov to read this document 
and the news release describing the proposed settlement. The FTC Act 
and other laws that the Commission administers permit the collection of 
public comments to consider and use in this proceeding, as appropriate. 
The Commission will consider all timely and responsive public comments 
that it receives on or before April 25, 2022. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``FTC'' or ``Commission'') has 
accepted, subject to final approval, an agreement containing a consent 
order from Electronic Payment Systems, LLC, also d/b/a EPS, Electronic 
Payment Transfer, LLC, also d/b/a EPS, John Dorsey, and Thomas McCann 
(``EPS'').
    The Commission has placed the proposed Order on the public record 
for thirty days for receipt of comments by interested persons. Comments 
received during this period will become part of the public record. 
After thirty days, the Commission will again review the agreement and 
the comments received, and will decide whether it should withdraw from 
the agreement and take appropriate action or make final the agreement's 
proposed Order.
    Respondent Electronic Payment Systems, LLC is an independent sales 
organization (``ISO'') that serves as an intermediary between merchants 
seeking to open credit card merchant accounts and its acquiring bank, 
which is the bank that has access to the credit card networks. John 
Dorsey and Thomas McCann are officers and the owners of EPS.
    The Commission's proposed Complaint alleges that, in 2012 and 2013, 
EPS served as the ISO for the entities involved in a deceptive 
telemarketing scam called Money Now Funding (``MNF'' or ``MNF scam''). 
The FTC sued MNF in 2013 for telemarketing worthless business 
opportunities to consumers and falsely promising that consumers would 
earn thousands of dollars in income. The principals of the MNF scam 
went to great lengths to hide their identities behind many phony 
businesses. In order to charge consumers' credit cards but make it 
difficult to trace the money back to MNF, MNF engaged in a credit card 
laundering scheme whereby its principals and employees created numerous 
fictitious companies. Those fictitious companies, through a sales 
agent, submitted applications for merchant accounts to EPS. With 
knowledge of the misconduct, EPS then opened merchant accounts in the 
names

[[Page 17091]]

of these fictitious companies, and victim credit card charges were 
processed through those accounts, rather than through a single merchant 
account in the name of MNF. With similar knowledge, EPS engaged in the 
underwriting and approval of MNF's fictitious companies and submitted 
merchant account applications for these fictitious companies to its 
acquirer. Using the services of two payment processors, EPS enabled 
more than $4.6 million in MNF transactions to be processed through 
these and other fraudulent merchant accounts.
    The Commission's proposed Complaint alleges that EPS's conduct 
regarding the MNF fictitious companies and their merchant accounts 
constituted an unfair act or practice under Section 5 of the FTC Act 
and assistance and facilitation of illegal credit card laundering under 
Section 310.3(b) of the Telemarketing Sales Rule, 16 CFR 310.3(b); see 
also Sec.  310.3(c) (banning credit card laundering).
    The proposed Order contains provisions designed to prevent EPS from 
engaging in the same or similar acts or practices in the future. 
Section I of the proposed Order contains prohibitions against engaging 
in credit card laundering; engaging in tactics to evade fraud 
monitoring or risk monitoring programs; providing payment processing 
services to any merchant that is engaged in any act or practice that 
is, or is likely to be, deceptive or unfair; and providing payment 
processing services to, or acting as an ISO for, any merchant that is 
listed on the MasterCard Member Alert to Control High-Risk Merchants 
(MATCH) list for several enumerated reasons.
    Section II imposes screening requirements that EPS must implement 
when it screens applications from prospective merchants that fall under 
the definition of ``Additional Review Merchants.'' The definition of 
Additional Review Merchant includes categories of EPS merchants that 
have been the subject of FTC cases: Merchants who engage in outbound 
telemarketing and merchants selling specific services (debt collection, 
debt relief, credit-related services, rental housing listings, job 
listings, or ``Money Making Opportunities,'' as defined in the order). 
Heightened screening of Additional Review Merchants includes obtaining 
detailed information about the merchant's business, as laid out in the 
order. EPS would also be required to take reasonable steps to verify 
the accuracy of the due diligence information it obtains.
    Section III requires increased monitoring of Additional Review 
Merchants. The order requires EPS to investigate merchants whose 
chargeback rate exceeds 1% and whose total number of chargebacks 
exceeds 55 per month in two of the preceding six months. Section IV 
requires monitoring of sales agents and termination of sales agents who 
are engaged in tactics to conceal credit card laundering.
    Sections V through IX are reporting and compliance provisions that 
allow the Commission to better monitor EPS's ongoing compliance with 
the Order. Under Section IX, the Order will expire in twenty years, 
with certain exceptions.
    The purpose of this analysis is to aid public comment on the 
proposed Order. It is not intended to constitute an official 
interpretation of the Complaint or proposed Order, or to modify in any 
way the proposed Order's terms.

    By direction of the Commission.
April J. Tabor,
Secretary.
[FR Doc. 2022-06306 Filed 3-24-22; 8:45 am]
BILLING CODE 6750-01-P