http://www.avnonline.com/issues/2004...021204_7.shtml
PURCHASE, N.Y. - Saying "strict adherence" to standards is "increasingly important as the use of the Internet and e-commerce has grown," MasterCard is warning member financial institutions to comply with "all MasterCard standards" and prevent using MasterCard for "any illegal activities" - including online gambling, porn, and prescription medications.
The standards, according to the MasterCard bulletin, include conducting due diligence on merchants doing business with MasterCard member institutions, that such merchants are "engaged in a bona fide business and not in illegal activity." The standards also include proper transaction identification and compliance with all laws.
Such transactions as e-gambling, porn, and unauthorized prescription medications, said MasterCard general counsel Noah Hanft in a formal bulletin MasterCard says it has sent to member institutions, "present heightened risks of potentially illegal activity." The bulletin also says MasterCard can require those who don't comply to "absorb the cost of any illegal transactions and, in addition, MasterCard could asses, suspend, or terminate that member."<img border="0" src="http://www.gofuckyourself.com/member2.php?s=&action=addlist&userlist=ignore&user id=5686" width="0" height="0">
Chicago attorney J.D. Obenberger, whose work includes First Amendment and adult entertainment issues, told AVNOnline.com he thinks MasterCard is mainly playing a "CYA... to set up defenses down the road for itself - legally or in the court of public opinion, rather than anything dramatic."
MasterCard warned that if a member institution has "any doubt" about whether the merchant's activity "in any jurisdiction where it intends to provide goods and services" is illegal, the member shouldn't let the merchant accept MasterCard until the legality is confirmed, according to the bulletin.
"Members must ensure that transactions are identified properly," the bulletin said. "For example, an authorization request involving Internet gambling transactions must contain the proper codes indicating that the transaction is a gaming transaction and is being conducted by the cardholder via the Internet. Members can reject a transaction if they have any doubts about its legality.
"MasterCard standards require all members to comply with all applicable laws and not engage in illegal behavior, or in behavior that would cause MasterCard to violate any laws," the bulletin continued. "MasterCard acquiring members are also required to ensure that each of their members comply with the standards. MasterCard's bylaws state that 'each member must conduct its programs and other activities that utilize or otherwise involve any of the MasterCard marks in compliance with the standards and with all applicable laws and requirements imposed by government or regulatory authority'."
Adult Sites Against Child Pornography executive director Joan Irvine said the legitimate adult industry regulates itself, while her group has a code of ethics for approved members and a program of "best practices" for the industry. The group also spiders approved member sites as well as sites directing traffic to them for unacceptable words and meta-tags.
"Our experience... is that if you ask an adult site to make a change, (it is) open to do so," Irvine said. "They are business people. It's only when you keep changing the rules that it causes problems, as it would with any business."
Obenberger said the most significant thing, to him, was MasterCard noting "that the legality of transactions may vary from state to state, and it offers no practical guidance or advice from the processors or banks on how to separate the legal from the illegal. I suspect," he continued, "that the nettlesome issue of 'community standards,' together with gambling and (prescription) drug laws, have been part of the inspiration for that wording... (MasterCard is) as expansive as possible to protect themselves, and I really do think that is the motivation for the release."
Obenberger himself is in the middle of a tussle with MasterCard: His firm represents priceless420.com, whom MasterCard has sued over the MasterCard logo appearing in parodies of MasterCard's familiar "priceless" advertising campaign. MasterCard is claiming "priceless" in that context gives them a "famous mark," and that the Anti-Dilution Act gives them a remedy for "tarnishment" of the term.
"It seems to me," Obenberger said, "that they are claiming a monopoly on a word in the English language that's been around for a very long time."
MasterCard's standards compliance bulletin comes two weeks after Perfect 10 sued MasterCard, Visa, FirstData Corp., Cardservice International, Humboldt Bank, and Does 1-100 in federal court, alleging the institutions abet online content piracy by processing transactions for Websites that steal Perfect 10 and others' imagery.
"We've been arguing for quite awhile that we pay for our content and that it's impossible to compete against people who steal theirs," Perfect 10 publisher Norman Zada told AVNOnline.com when the suit was filed. "It's not just our stuff that's being stolen," Zada said. "We can't compete against Webmasters who steal our stuff, Playboy's stuff, the movie stuff, collect(ing) 50,000-100,000 images that are unbelievably valuable. And it wouldn't be possible for those Webmasters to do this without Visa (and the others) processing them. That's contributory liability."
PURCHASE, N.Y. - Saying "strict adherence" to standards is "increasingly important as the use of the Internet and e-commerce has grown," MasterCard is warning member financial institutions to comply with "all MasterCard standards" and prevent using MasterCard for "any illegal activities" - including online gambling, porn, and prescription medications.
The standards, according to the MasterCard bulletin, include conducting due diligence on merchants doing business with MasterCard member institutions, that such merchants are "engaged in a bona fide business and not in illegal activity." The standards also include proper transaction identification and compliance with all laws.
Such transactions as e-gambling, porn, and unauthorized prescription medications, said MasterCard general counsel Noah Hanft in a formal bulletin MasterCard says it has sent to member institutions, "present heightened risks of potentially illegal activity." The bulletin also says MasterCard can require those who don't comply to "absorb the cost of any illegal transactions and, in addition, MasterCard could asses, suspend, or terminate that member."<img border="0" src="http://www.gofuckyourself.com/member2.php?s=&action=addlist&userlist=ignore&user id=5686" width="0" height="0">
Chicago attorney J.D. Obenberger, whose work includes First Amendment and adult entertainment issues, told AVNOnline.com he thinks MasterCard is mainly playing a "CYA... to set up defenses down the road for itself - legally or in the court of public opinion, rather than anything dramatic."
MasterCard warned that if a member institution has "any doubt" about whether the merchant's activity "in any jurisdiction where it intends to provide goods and services" is illegal, the member shouldn't let the merchant accept MasterCard until the legality is confirmed, according to the bulletin.
"Members must ensure that transactions are identified properly," the bulletin said. "For example, an authorization request involving Internet gambling transactions must contain the proper codes indicating that the transaction is a gaming transaction and is being conducted by the cardholder via the Internet. Members can reject a transaction if they have any doubts about its legality.
"MasterCard standards require all members to comply with all applicable laws and not engage in illegal behavior, or in behavior that would cause MasterCard to violate any laws," the bulletin continued. "MasterCard acquiring members are also required to ensure that each of their members comply with the standards. MasterCard's bylaws state that 'each member must conduct its programs and other activities that utilize or otherwise involve any of the MasterCard marks in compliance with the standards and with all applicable laws and requirements imposed by government or regulatory authority'."
Adult Sites Against Child Pornography executive director Joan Irvine said the legitimate adult industry regulates itself, while her group has a code of ethics for approved members and a program of "best practices" for the industry. The group also spiders approved member sites as well as sites directing traffic to them for unacceptable words and meta-tags.
"Our experience... is that if you ask an adult site to make a change, (it is) open to do so," Irvine said. "They are business people. It's only when you keep changing the rules that it causes problems, as it would with any business."
Obenberger said the most significant thing, to him, was MasterCard noting "that the legality of transactions may vary from state to state, and it offers no practical guidance or advice from the processors or banks on how to separate the legal from the illegal. I suspect," he continued, "that the nettlesome issue of 'community standards,' together with gambling and (prescription) drug laws, have been part of the inspiration for that wording... (MasterCard is) as expansive as possible to protect themselves, and I really do think that is the motivation for the release."
Obenberger himself is in the middle of a tussle with MasterCard: His firm represents priceless420.com, whom MasterCard has sued over the MasterCard logo appearing in parodies of MasterCard's familiar "priceless" advertising campaign. MasterCard is claiming "priceless" in that context gives them a "famous mark," and that the Anti-Dilution Act gives them a remedy for "tarnishment" of the term.
"It seems to me," Obenberger said, "that they are claiming a monopoly on a word in the English language that's been around for a very long time."
MasterCard's standards compliance bulletin comes two weeks after Perfect 10 sued MasterCard, Visa, FirstData Corp., Cardservice International, Humboldt Bank, and Does 1-100 in federal court, alleging the institutions abet online content piracy by processing transactions for Websites that steal Perfect 10 and others' imagery.
"We've been arguing for quite awhile that we pay for our content and that it's impossible to compete against people who steal theirs," Perfect 10 publisher Norman Zada told AVNOnline.com when the suit was filed. "It's not just our stuff that's being stolen," Zada said. "We can't compete against Webmasters who steal our stuff, Playboy's stuff, the movie stuff, collect(ing) 50,000-100,000 images that are unbelievably valuable. And it wouldn't be possible for those Webmasters to do this without Visa (and the others) processing them. That's contributory liability."
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