As the payment industry utilizes new technologies to become more dynamic, efficient, and cost-effective, industry innovators must increasingly depend on legal counsel who are adept at advising on legal issues related to the full range of emerging and prepaid payment mechanisms. Prepaid payment solutions are the fastest-growing emerging payments sector and have reached a scale and scope that was barely imagined even a few years ago. Even the most innovative payment solutions generally involve elements of the legacy payment networks, which makes it crucial to have an advisor who understands the underlying operational and banking infrastructure of how payments are processed and how money is traditionally transferred.
At DWT, we feel that it is critical not just to monitor legal and regulatory developments in the mobile payments landscape, but to understand business and technology trends and developments as well. We undertake to do that, and to keep our clients apprised of these developments, in several ways, including:
- Engaging in dialogue with leaders from across the emerging and prepaid payments ecosystem at numerous thought leadership conferences, including ACI’s National Forums on Emerging Payment Systems and Prepaid Card Compliance, LSI’s Conferences on Mobile Payments Law, the RAMP Advanced Commerce and Mobile Retail Services Summit, Mobile Commerce World 2013, the Payment Card Institute (to be renamed the “Retail Payments Institute”), American Bar Association conferences, American Bankers Association conferences, and the International CTIA Wireless expo. DWT payments team members have served as co-chairs, presenters, panelists, and moderators at each of these conferences. The perspective and insight that we gain as participants in these conferences, from regulators, business leaders, other outside counsel, and in-house counsel, enable us to help our clients anticipate where the market is moving and how to assist our clients to best take advantage of the ever-changing competitive landscape.
- The development and maintenance of our payments website, www.paymentlawadvisor.com (or PLA). We use PLA to offer commentary on new developments in the payments world that seem particularly significant, as well as to provide resources that we believe can be helpful to others who are tasked with anticipating, understanding and addressing these developments. We focus on writing about topics and adding resources that we hope our clients can use to broaden and deepen their knowledge about all aspects of the payments world, from regulatory and legislative developments to technological advances to transactional templates. These same resources also serve as knowledge management tools for us and our clients.
- Creating interdisciplinary client teams comprised of leading lawyers from our telecommunications, technology, intellectual property, data security and privacy, health care, and litigation practices, along with our payments lawyers. These interdisciplinary teams have been a major element in the success of our clients and our ability to provide comprehensive support across an array of legal and strategic issues.
We can assist clients with issues involving virtually any prepaid or other emerging payment technology or system, including payment cards; biometrics; emerging network technologies; stored value; near field communication (NFC); general purpose reloadable prepaid cards; online person-to-person (P2P) payments; virtual currency; electronic cash; account-to-account (A2A) payments; Electronic Bill Presentment and Payment (EBPP); mobile card acceptance; cloud-based solutions and payment processing; Internet, mobile, and contactless payments; next-generation credit and rewards cards featuring microcomputers; multi-purse cards; digital and mobile wallets; remote deposit capture; and more.
With a payment systems team few firms can match for depth and breadth, we offer the full scope of services required to operate at any point in the payment process to a range of clients, from card issuers to processors to merchants. We have extensive experience counseling clients on the regulatory and compliance issues associated with payment systems transactions. We are also fully experienced in structuring such transactions, including handling program agreements, portfolio purchases and sales, and processing agreements.
Transactional depth and relevant experience
We have represented major issuers, retailers, processors, technology providers, and program managers in negotiating and documenting hundreds of agreements for the issuance and management of co-branded general-purpose credit cards; co-branded debit cards; private-label cards, general purpose reloadable prepaid cards, open-and closed-loop gift cards; loyalty, rewards, and points programs; virtual currency; payment processing arrangements; and online marketplaces. We have handled many other aspects of payment systems and programs, including both major commercial agreements and customer disclosures and agreements for use online, for mobile commerce, on the telephone, and in person, across a wide range of industries from airlines to global oil companies and including 529 plans, healthcare, and agreements for sports teams.
A representative sample of our experience includes:
- Representation of financial institutions and mobile telecommunications carriers in connection with the implementation of mobile payment systems.
- Representation of a major financial institution in implementing a mobile payment solution for remote and proximity payments with a leading Internet company in the U.S.
- Representation of a major financial institution in implementing a mobile P2P payment solution with a leading provider of mobile payment services in the U.S.
- Representation of a major financial institution in implementing a mobile ACH-based P2P payment solution in the U.S.
- Representation of a major financial institution in implementing a mobile payment solution in the Caribbean.
- Advised a major issuer on consumer regulatory issues associated with an iPhone application.
- Representation of a major financial institution with respect to a BIN sponsorship agreement to issue a prepaid account for a mobile wallet.
- Representation of a technology client in structuring, documenting and negotiating technology license and services agreement in connection with the client's development of a mobile payments processing platform.
Prepaid products and services
- Representation of two major card issuers in launching their first consumer prepaid products, including documenting and negotiating the processing agreements and money transmission agreements, as well as handling customer documentation and collateral.
- Representation of major prepaid program manager on regulatory and transactional issues for matters relating to their prepaid products and reload network.
- Representation of prepaid program manager for college savings gift card product.
- Representation of major wireless carriers in launching co-branded general purpose reloadable prepaid card programs, including remote deposit capture capability.
- Representation of many retailers for gift card, stored value, and related prepaid products and services.
- Representation of global technology company in assessing money transmitter issues for numerous products and services, including stored value, online marketplaces, payment processing, virtual currency, and other initiatives.
- Representation of licensed money transmitter in evaluating impact of innovative rewards and loyalty programs on money transmitter compliance.
- Representation of payment processing and other technology providers in structuring operations for money transmitter compliance.
- Representation of companies in responding to state inquiries regarding unlicensed money transmission.
- Representation of major licensed money transmitter and retailer in structuring and documenting innovative debit, prepaid, and gift card arrangements.
- Representation of nationally- licensed cash-based money transmitter on regulatory and related agency matters.
- Representation of private equity investors in purchasing an established major international money transmitter.
- Representation of numerous companies providing cash management, automated accounts payable service, and other outsourced treasury management services.
- Numerous engagements to conduct due diligence of prospective money transmitter partners for established companies.
- Representation of applicants in various states for money transmitter licenses and FinCEN registration issues.
- Representation of major card issuers, technology companies, game publishers, and retailers on state unclaimed property laws.
- Representation of financial institutions, technology companies, and game publishers in evaluating virtual currency schemes.
- Representation of venture capital investors in a new P2P online payment system.
- Advice on compliance with state and federal consumer protection and credit laws and on the structuring, negotiation, and documentation of payment and banking agreements and infrastructure for a major P2P lending website.
- Representation of clients in connection with structuring and documenting agreements for the purchase of billing and payment systems infrastructure for the provision of international SMS messaging services.
In working on matters such as those described above, we have advised clients on regulatory issues encompassing a wide range of legislation affecting the payment industry on both federal and state levels, including:
- Electronic Fund Transfer Act and Regulation E
- Truth in Lending Act and Regulation Z
- Bank Secrecy Act, anti-money laundering compliance, and FinCEN regulations and guidance
- Gramm-Leach-Bliley Act privacy and data security issues
- Federal Deposit Insurance Act
- Payment network rules (including card brands and ACH)
- State licensed lender, loan broker, and other consumer financial protection laws
- State money transmitter, payment instrument, and check seller laws
- State gift card laws
- State unclaimed property laws
- State PUC regulations governing billing of third-party services to mobile bills
- FCC Truth in Billing