FTC Obtains $6.5 Million Contempt Sanction Against Payment Processor

On May 19, the FTC announced that the U.S. District Court for the District of Nevada held a payment processor and two of its executives in civil contempt for allegedly violating a 2015 order governing the company’s payment processing activities. According to the FTC, the court found that the defendants failed to comply with requirements designed to prevent the processing of payments for merchants engaged in fraudulent or deceptive conduct and imposed $6.5 million in sanctions.

The underlying order arose from a 2015 settlement of an earlier FTC enforcement action involving allegations that the payment processor facilitated unauthorized payment transactions. Under the settlement, the firm committed to certain compliance measures and paid $3.3 million without admitting wrongdoing. In its recent ruling, the court concluded that the defendants violated multiple provisions of the 2015 order. Specifically, the court found that the defendants: