According to a complaint filed by the FTC, the defendants arranged for a deceptive operation known as I Works to obtain and maintain merchant accounts that allowed it to process more than
Today's case alleges that the defendants -
In its complaint, the FTC alleged that the defendants knew I Works had been placed on industry lists of high-risk merchants numerous times due to high chargeback rates. In spite of this, the defendants provided I Works with unfettered access to payment networks and failed to engage in their contractually required underwriting process when they opened accounts for I Works, according to the FTC's complaint.
In fact, the FTC charged, the defendants helped I Works evade the credit card networks' fraud monitoring programs to help keep I Works' merchant accounts open. The defendants opened at least 293 accounts in the names of 30 separate shell corporations on I Works' behalf, and implemented a system that enabled I Works to divide its sales transactions between these accounts in order to avoid reaching the thresholds necessary for its accounts to be monitored by the credit card networks.
According to the FTC's complaint, CardFlex, as an
Blaze Processing, Mach 1 Merchanting, and
The stipulated final order against
The Commission vote authorizing the staff to file the complaint was 4-0-1, with Commissioner McSweeny not participating. The Commission vote approving the stipulated final order was 4-0-1, also with Commissioner
TNS 30FurigayJof-140802-4818808 30FurigayJof
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OCTOBER 31, 2014
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