Credit card giant VISA International has suspended its business with ePassporte, an Internet payment system widely commonly used to pay adult Webmasters and a raft of other affiliate programs.
Company owner Christopher Mallick broke the news to ePassporte customers in an e-mail sent Thursday, saying Visa International had suspended the company’s ePassporte Visa program, which is processed through St. Kitts Nevis Anguilla National Bank.
Dear ePassporte Account Holders,
Please be advised that, at 12:00 PM PDT today, September 2, 2010, we were notified that effective immediately, Visa International has suspended our banking partner’s (St. Kitts Nevis Anguilla National Bank) ePassporte Visa program. The ePassporte e-Wallet program continues to be up and running, except funds cannot be transferred between your Visa Account and your e-Wallet. At this time ePassporte can no longer issue Visa Cards, and the ability for our Account Holders to make point of sale purchases and withdraw funds from ATMs has also been suspended.
At this time we do not know why this drastic action was taken by Visa. To us, it is unconscionable that such action would be taken without the opportunity for ePassporte to fully understand Visa’s reasons and to be able to take all steps necessary to keep our program running the way it has so successfully done for over 7 years. But that is what Visa has done.
As soon as we have more information we will be in contact with you.
In the meantime please be assured that your funds are safe.
We are very sorry for the short notice and apologize for any inconvenience this may cause. The ePassporte team is working diligently to rectify this situation.
We kindly ask you to bear with us while we work through this issue.
Please feel free to contact us via the message center or at our call center, should you have any questions, comments or concerns.
ePassporte’s Visa Virtual Account allowed customers to pay online at any Website that accepted Visa cards. The program also issued customers physical cards that could be used to withdraw cash at ATMs around the globe.
I reached out to both Mallick and Visa for further details and will update this blog if I hear from either.
Update, Sept. 7, 1:07 p.m. ET: Visa just issued the following statement, sent to me via e-mail in response to my request last week for more information:
“At the request of St. Kitts-Nevis-Anguilla National Bank (SKNA), on September 2, 2010, Visa blocked network access for prepaid cards issued by SKNA and operated by ePassporte.com to address certain program deficiencies. ePassporte.com is a third-party agent that works with SKNA.
“It is important to note that impacted SKNA prepaid cardholders are still able to access their funds through SKNA or SKNA’s agent, ePassporte.com. For more information cardholders should contact SKNA or ePassporte.com.
“Visa is committed to maintaining the integrity of its global payment network and routinely conducts due diligence to ensure Visa prepaid programs adhere to the company’s stringent program requirements and controls.”
This news caught my attention because I have recently encountered ePassporte accounts tied to several shady affiliate programs, such as those used to reward people who promote rogue anti-virus products and online pharmacy sites.
A number of adult Webmaster forums are buzzing with the news, but few seem to know more than what’s in the statement from ePassporte. However, the administrator of the online forum italkcash.com suggests that the move by Visa is in response to new anti-money laundering requirements mandated by the Credit Card Act of 2009, which affects prepaid cards and other payment card instruments that can be reloaded with funds at places other than financial institutions.
While ePassporte’s Mallick can’t be happy about these developments, the situation may provide a nice bump for his new movie: Mallick helped produce the Paramount film Middle Men, a movie released Aug. 6, 2010 that is based on his personal experiences in the porn Web site billing industry. The synopsis from the film’s Wikipedia entry seems oddly prescient:
In 1995, straight-and-narrow businessman Jack Harris (Luke Wilson) who builds the first online billing company dealing exclusively with adult entertainment, finds himself in the middle of a whirlwind filled with starlets, con men, Russian mobsters, federal agents, and international terrorists. Caught between a porn star and the FBI, Harris learns that even becoming one of the wealthiest entrepreneurs of his generation may not be enough to keep him out of trouble. It is based on the experiences of producer Christopher Mallick.
Click the image below for a Youtube.com trailer of the movie.