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Escort Services Escalated to Potential Violations

Post Categories: Blog

By: Greg Baxley, Marketing Coordinator

 

Over the years, there have been many perceived grey areas in the payments industry, with laws that vary between regions concerning certain types of online businesses. Escort services and dating sites are good examples of the types of companies that have been scrutinized in the past. While the people behind these businesses would argue that their services are distinctly legal, and in most regions they are; recent attention from the media has proven that criminal practices can be easily operated through sites peddling these “legal” services.

 

As more and more fraud has been detected, and with building media attention, the card schemes and regulators have heightened their responsiveness. These categories are becoming much more clearly drawn. As a result, in November of last year, G2 Web Services made a decision to re-categorize dating and escort sites due to rising concerns for public safety. Escort websites were previously marked as TOS Adult (Terms of Services) in lower level reporting. Due to an increase in scrutiny and frequency, G2 has escalated these sites to a pVio (Potential Violation). All card schemes have assessed for escort services.

 

Due to growing links with prostitution and human trafficking crimes, these types of online businesses have gained government examination. Child sex trafficking statistics in particular are shocking. The Justice Department estimates that each year 200,000 children are at risk for being trafficked for sex in the US. The digital black market for sex advertising is contributing to one component of a growing human trafficking industry that is estimated to generate upward of $32 billion worldwide this year.

 

There has also been a growing shift of prostitution from the streets to the Internet, previously accessed through classified websites, and more recently integrated into established online dating portals.

 

Financial institutions, both large and small, can play a critical role in identifying and reporting transactions related to these unlawful activities based on observations made using Persistent Merchant Monitoring and Transaction Laundering Detection services offered by vendors like G2 Web Services.

 

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