News & Updates
The Latest on Internet Pharmacies, Supplements, Designer Drugs,
and Other High-Risk Merchants
Why a CBD Merchant Account is Still Hard to Get, and What You Can Do About It
CBD merchant accounts are still difficult for CBD producers, merchants, and retailers to get, despite the passage of the 2018 Farm Bill, which legalized hemp and hemp-derived CBD with THC levels of no more than 0.3 percent. Why are payment service providers still wary about onboarding CBD merchants? The answer lies in the fact that…
CBD Demand is Causing a Rise in Transaction Laundering
One of the most pervasive threats to payment service providers is transaction laundering — which is often used to process credit card transactions for illicit pharmaceuticals or intellectual property infringement, but increasingly is used for cannabidiol (CBD) products. Since the change in legal status of certain forms of CBD as a result of the 2018…
What the Blackstone Labs Indictment Means for Payment Service Providers
Last month, six people associated with Blackstone Labs were charged in an indictment to market and sell illegal dietary supplements for use in bodybuilding and weight loss. The indictment is significant because of the size and reach of Blackstone Labs, and because of the way it is alleged to have deceptively labeled products for years.…
Q&A with Evan Ratliff, Author of The Mastermind
In 2012, LegitScript estimated that at least half of the rogue online pharmacies in the world were registered through ABSystems, a registrar operated by criminal mastermind Paul Le Roux. This massive network of online pharmacies, which fell under the umbrella of an operation called RX Limited, facilitated the sale of prescription drugs to US customers…
Enhanced Athlete CEO Pleads Guilty to Felony Related to Online Sale of Dangerous Substance
The CEO of Enhanced Athlete, Inc., a California-based dietary supplement distributor, pleaded guilty late last month to a felony related to the marketing and sale of DNP, a dangerous substance used by bodybuilders and others for weight-loss purposes. The plea made by Scott Cavell came just weeks after a criminal conviction in a UK court…
How Will the FDA’s New Dietary Supplement Working Group Affect You?
Food and Drug Administration Commissioner Scott Gottlieb announced last month a new working group to improve oversight of the dietary supplement industry. The move could mean increased safety for consumers, but also increased scrutiny of dietary supplement merchants and the payment facilitators that onboard them. An Unwieldy Industry In a speech at the Food and…
The Top High-risk Payments Trends for 2019
The constantly changing landscape of online payments can be difficult for payment facilitators to keep up with. This year, technological advancements, criminal innovation, and shifting consumer interests shifted the types of problematic merchants most likely to pop up in portfolios. LegitScript tracked the data this year to identify which merchants may cause payment facilitators the…
The Spread of Online Intellectual Property Infringement Should Worry Payment Providers and Consumers
This week, Europol’s Intellectual Property Crime Coordinated Coalition announced the seizure of more than 33,000 domain names distributing counterfeit and pirated items online. The websites marketed and sold items such as counterfeit goods, pirated entertainment, software, electronics, and other bogus products. The operation involved the cooperation of the US National Intellectual Property Rights Coordination Center…
Watch Out for Fraud Through Unauthorized Aggregation
This week, a New Jersey couple and a homeless veteran were arrested and charged with conspiracy and theft by deception for an alleged fraud scheme on the online crowdfunding platform GoFundMe. According to NPR, the three raised $400,000 from more than 14,000 donors based on an allegedly fabricated story of a Good Samaritan. It’s the latest high-profile scam to draw attention to online aggregators and the risks they pose for payment facilitators.
Are Payment Facilitators Unwittingly Complicit in Anti-Semitic Rhetoric?
Last weekend’s shooting at the Tree of Life Congregation Synagogue in Pittsburgh, Pennsylvania, has prompted many to look at the online space and the degree to which platforms allow hate speech and extremist ideas. Although attention is focused mostly on social media outlets used by the shooter — including Gab and Twitter — what role…