New Payment Methods

natureplaygroundΤεχνίτη Νοημοσύνη και Ρομποτική

14 Νοε 2013 (πριν από 3 χρόνια και 7 μήνες)

61 εμφανίσεις

MOVING MONEY WITHOUT A
TRACE


New Payment Methods

Cash


Banks

MSBs

Traditional Payment Systems

4

New Payment Methods

Prepaid Cards



Open Closed

European Pin and Chip

PSVC Universe

Digital Currencies

Used to fund PSVCs

Banks

Issue Cards

Hold Funds

Sellers

Sell and fund PSVCs


Stores/Internet

Internet

Card Registration and
activation. Purchase of
cards, funding of cards,
access to digital currencies

Distributors

Organize, Market, and
Distribute PSVCs

Program Managers

Operate and Run PSVC
Programs

Processing Companies

Card account set up and
activation, card production,
maintain databases of card
balances and transfers

ATM Networks

Provide direct access to
funds (Plus, Cirrus, Star,
Maestro, etc.)

Prepaid Stored
Value Cards

Branded Card Payments
Networks

(Visa, MasterCard, American
Express, etc.)

Branded Card Payments
Networks

(Visa, MasterCard, American
Express, etc.)

Program Managers

Operate and Run PSVC
Programs

Processing Companies

Card account set up and
activation, card production,
maintain databases of card
balances and transfers

Digital Currencies

Used to fund PSVCs

Sellers

Sell and fund PSVCs


Stores/Internet


Final Rule Issued July 26, 2011


Change of Terms: Prepaid access


Providers of Prepaid access


Determined by contractual agreement


Require Registration of Provider of Prepaid
Access


Require Customer Identification Programs

Evolving Safeguards


Final Rule Issued July 26, 2011


Require SARS from Providers


Sellers covered if sell products greater than $10k
on any one day


Closed looped exempted


sold in amounts less
than $2K


Cross Border Reporting


Requires Regulatory
Fix


new definition to be added to “monetary
instruments” new NPRM

Evolving Safeguards

Sallie
Wamsley
-
Saxon



Sallie
Wamsley
-
Saxon ran
Charlotte, NC
-
based prostitution
ring with her husband



Charged up to $700/hour



Sallie and her husband took 30%



Each had 5 prepaid cards in their
names with a $2500 load limit, so
they could load $25,000 at a time
without a CTR being filed

Identifying Stored Value Cards


Problem:


Open System cards look and operate
just like bank ATM cards so they can
be difficult to identify


Open System cards do not have to be
branded


Online Payment Systems


Facilitate e
-
commerce by providing a non
-
face
-
to
-
face settlement mechanism.

PayPal


PayPal is the largest online payment system, with
$60 billion worth of transactions in 2008.


PayPal is registered and licensed as a money
transmitter.


It has an AML program and reporting
requirements.

Originator

Beneficiary

Originator’s

PayPal account

Beneficiary’s

PayPal account

Introducing Financial Investigations

Digital Currency


Internet
-
based service providers that use
gold, silver, platinum, and palladium as
the store of value


Digital Exchange Services act as
intermediaries, accepting payment and
transacting with digital currency
providers


Used for speculation in commodities,
person
-
to
-
person payments, commercial
payments

Terrorism Financing

Cyber
-
Jihadis

Younes Tsouli, Tariq Al
-
Daour and Waseem Mughal

Convicted in UK of: Inciting Terrorist murder via internet,
Conspiracy to defraud banks, credit companies


37,000 stolen credit card numbers


£1.8 million in fraudulent transactions


Set up Web sites & communication sites


Considerably more complex value chain.


Advertised anonymity and instant settlement
important features of the system.


E
-
gold

Originator

Beneficiary

Originator’s

e
-
gold account

Beneficiary’s

e
-
gold account

e
-
gold
exchanger

e
-
gold
exchanger

Bogus account info is the norm

E
-
gold


E
-
gold was used to launder the
proceeds of:


Child pornography.


Identity theft.


Bank fraud.


Ponzi schemes.


Illegal online drug sales.

RBS
WorldPay



RBS
WorldPay



U.S. payment processing arm
of The Royal Bank of Scotland


announced in
Dec ’08 that its systems had been hacked.


1.5 million prepaid cardholders’ info stolen.


Withdrawal limits reset on ~100 payroll cards.


Gang of hackers


5 Estonians, 1 Russian, 1
Moldovan


RBS
WorldPay


Network of cashers supplied with 44
counterfeit payroll prepaid cards



2100+ ATMs in 280 cities ~$9 million
withdrawn in less than 12 hours



Money moved from cards to
WebMoney

, a digital currency


Virtual Currencies

Bitcoin

Market

The Armory

The Armory

Bitcoin

Exchangers

New MSB Regulations


Issued July 21
st
, 2011, effective September 19
th


New registration requirements


6 months from
July 21
st


Prior to this rulemaking, the regulatory definition of
MSB covered ‘‘[
e]ach agent, agency, branch or
office within the United States
of any person
doing
business, whether or not on a
regular basis or as
an organized business concern


New Rule: “
A person wherever located doing
business,

whether or not on a regular basis or as
an organized or licensed business concern, wholly
or in substantial part within the United States”

31 CRF 1010.100 (ff)

Mobile Payments

Payment Tag:


Can be Prepaid Card

Mobile Payments

Phone as a Credit Card
Terminal
-
Square

Phone as payment
mechanism


M PayPal

ING Bump Payments

Square

Cards in Case

Newest Threat


Virtual Reality

Virtual Gaming Currencies


Massive Multiplayer Online Role
-
Playing
Game (MMORPG)


Entropia

PEDs


Q coins


Linden dollars (Second Life)


Game Coins

Entropia

Universe

Entropia

Universe
to operate
real
-
world bank
with virtual world
presence

Second Life



First Person to make $1
million USD in Second
Life


Purchased and
developed real estate


Sells own line of clothing


Virtual
-
bank scam leaves

depositors with real

loss


“The 33
-
year
-
old from Chicago,
who played the game as a raven
-
haired Vixen called
ZaniaTurner
,
deposited $140 in
Ginko

Financial
and waited for the money to grow.
Instead, it vanished five months
ago when
Ginko
, perhaps the first
Ponzi

scheme in history
perpetrated by three
-
dimensional
online avatars, left Second Life.”


LA Times 1/28/2008

On the Internet…

…nobody knows you’re a dog.

Susan L. Smith

Asset Forfeiture and Money
Laundering Section

202/514
-
1434 or 1263

Susan.Smith2@usdoj.gov