Electronic Financial Services

To address a perceived gap in regulatory treatment of increasingly popular virtual currencies, including Bitcoin, the U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN) released new guidance on March 18, 2013.

The Supreme Judicial Court of Massachusetts recently held that collecting a consumer's ZIP code at the point of sale may violate Massachusetts General Laws Chapter 93, Section 105(a) (Section 105(a)), which restricts the ability of retailers to collect personal identification information (PII) from consumers in connection with a credit card transaction.

The California Supreme Court recently issued a landmark ruling in Apple Inc. v. Superior Court (formerly Krescent v. Apple Inc. in trial court proceedings), a case with wide-reaching implications for consumer privacy in e-commerce. The issue before the Court was whether California’s Song-Beverly Credit Card Act (the Act), which generally prohibits retailers from collecting or requesting personal identification information (PII) as a condition of accepting credit card payments, should apply to online retailers.

Companies that accept online credit card payments should be keeping an ear very close to the ground for the California Supreme Court’s decision in Apple v. Superior Court (Krescent), expected within the next few weeks.  Depending on how the court rules, the case has the potential to spawn a flood of class actions against online retailers and change the way web payments are processed.

Mobile point-of-sale payment terminals have experienced explosive growth over the past year.  Unlike a traditional point-of-sale terminal, a mobile terminal communicates wirelessly when processing payment cards.  There are different types of solutions in the market, but one popular type is an application within a mobile device, like a smartphone or tablet, that uses a hardware attachment to swipe payment cards. 

On August 21, 2012, the U.S. District Court for the Eastern District of New York held that poker is a game of skill and thus running a poker game or business is not subject to federal prosecution under the federal Illegal Gambling Business Act ("IGBA").  Following on the heels of the Justice Department's September 20, 2011 ruling that the Wire Act (which prohibits using wire-line communications to place or receive bets) only applied to sports betting, last week's ruling may be another step toward legalizing online poker.