RISK IN PAYMENT TOOLS

Risks Seen in Payment Tools
officers are concerned that emerging payment methods, including virtual and mobile payments and prepaid cards, could be used for financial crimes, according to a survey the consulting firm Fortent Inc. released last week.
In an online survey of compliance officers and risk managers from 30 major financial companies, Fortent found that 52% viewed these new methods as a potential source for identity theft, and 78% expect to see more regulatory interest in them.
Forty-four percent said virtual payments, in which people use real money to purchase virtual currency in online games, could be used for financial crimes, and 28% said they were concerned about misuse of stored-value cards.
Ed Baum, Fortent's chief marketing officer, said in an interview that stored-value cards and virtual currencies offer consumers a high level of anonymity. "Stringent, up-front due diligence in terms of 'know-your-customer' procedures can help minimize risks."