Online payment processor, EMO, has been shut down by the Texas Attorney Generals office. This comes at the heels of the shut down of 12DailyPro and the debacle involving 12DP, StormPay, and many other online auto-surf companies. After 12DailyPro had it's account frozen by StormPay, it was attempting to use EMO as a backup payment service.EMOCorp was an Ithaca, NY based online payment processor that used web based money orders to transmit money to customers.
According to the complaint by the Texas AG, EMO cannot account for more than $5.4 million of customer transactions and is not a licensed payment processor in the state of Texas. What was unknown to many people before the 12DP/SP incident was that payment processors must be registered in certain states, according to their laws, to act as a bank or money transfer service.
This is a very big concern with customers since most of the use of these online payment processors involved a level of trust, as they require levels of verification in order to use their services - sometimes including a copy of a drivers licenses and voided checks. The Texas AG considers EMO an insolvent company, which insinuates that the operators of the company may have embezzled the funds that customers placed into EMO.
Court order against unlicensed online payment service
03/13/2006
Associated Press
Texas has secured a court order for a receiver to take over operations of an unlicensed online payment service based in Austin.
Attorney General Greg Abbott today announced the state has obtained an order to freeze the assets of E-M-O Corporation.
Abbott says the company can't fully account for more than five-point-four (M) million dollars consumers had in their accounts.
He says E-M-O documents show only three (M) million dollars -- in cash -- on hand.
Abbott also says the company isn't register with the Texas Banking Department and never obtained a license as a money services business -- as required by law.
Company officials didn't immediately return a call to The Associated Press for comment.
View the press release from the Texas AG against EMO here
The Texas Department of Banking
Court order against unlicensed online payment service - Dallas Morning News
No comments:
Post a Comment