First Data agrees to $40m FTC settlement
First Data Merchant Services (First Data) has agreed on a $40 million settlement with the Federal Trade Commission (FTC), which it will use to provide refunds to consumers who may have been harmed.
The resolution relates to isolated business practices by a single US-based wholesale independent sales organisation (ISO), its merchants, and affiliates of the ISO that referred merchants to the ISO between 2012 and 2014.
As part of the agreement, First Data states that it will enhance its wholesale ISO compliance and oversight program by putting in place additional oversight and monitoring activities, many of which the company had implemented even before the settlement.
“This agreed resolution, which relates to a single US-based ISO within the wholesale channel, is in the best interest of First Data, our clients and their customers, and consumers,” says the company in a statement.
“We remain committed to ensuring that our business partners and merchants operate with integrity, and our enhanced practices will enable us to continue to lead the industry in fraud prevention, and business and consumer protection.”
In addition, enhanced underwriting and fraud monitoring processes will further protect consumers from merchants who attempt to defraud them.
Fiserv, which acquired First Data in July 2019, has increased its investments in areas that improve detection of attempted fraud on its platforms, underwriting requirements, activity reviews and fraud alert protocols. These improvements will further reduce the opportunity for fraudulent merchant activity.