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Fedo, one of our readers, provided the link to a recent order against Uniclear. Uniclear operated out of Canada, had ACH capabilities and a debit card. Except for their slow customer service, hard to interpret terms of service, and sometimes slow fulfillment, they were a good option for loading and unloading e-gold. They were also payment processors for several autosurfs as well as a few HYIPs. As you read through the order, it states that Uniclear complied fully with Canada’s Proceeds of Crime and Terrorists Financing Act and the US Patriot Act.
So, what did Uniclear do wrong? They operated without a license! A cease and desist order was issued on March 24, 2006, but Uniclear continued to operate. All accounts were seized. It doesn’t say anything about anyone getting their money back.
If this doesn’t scare you away from using unlicensed money transmitters/payment processors/debit card processors/deposit businesses, I don’t know what will. If you’re going to deposit money or transfer it around, please make sure you’re using a licensed business. In addition, it’s a good idea to stay away from any HYIPs/autosurfs that use unlicensed payment processors as one of their options.
JMO-Sharon
Popularity: 1% [?]
Hmm..forgive me for my ignorance, what should be the license that a payment processor should possess? For example, in Singapore, certain financial activities do not require the approval of the Monetary Authority of Singapore.
Just wondering what is the license that we should look out for when dealing with payment processors? and how do we verify that a certain license produced by a certain payment processor is genuine or not?
Thanks.
Renba,
Licensing is Country dependent. In the US, the business must have a Federal license, an SEC license and if they are operating in the 41 states that require licenses, then they must have a state license as well. For example, PayPal displays their licenses at https://www.paypal.com/cgi-bin/webscr?cmd=p/ir/licenses-outside
I don’t know much about Canada, but it looks like a license is required from the Ministry of Finance.
Beyond the US and Canada, I don’t have any knowledge. If the business doesn’t display their license information anywhere on their site, you can ask them about it. They should supply you with either the license information or specific laws as to why they don’t need a license.
I hope this helps!
JMO,
Sharon