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executives accountable for their companies' security
policies, procedures and collaborations with third-party
service providers. Maria T. Vullo, DFS Superintendent of
Financial Services, introduced the legislation in March
2017, which included a 180-day transitional period to give
organizations time to become compliant. Vullo said she
expects the new laws to address "the ever-growing threat
posed to information and financial systems by nation-
states, terrorist organizations and independent criminal
actors."
Savvy competitor Square adds showroom
Square Inc., which took the micro merchant segment by
storm in 2010 with the rollout of a user-friendly mobile
payment dongle and simple pricing program, opened a
retail store last week in New York City. Called Showroom,
the lower Manhattan storefront serves as a tech support
center, showcase for Square products and pop-up store for
curated products sold by Square users.
Curious about what the payments community thinks of
Square's latest move, The Green Sheet asked a number of
industry veterans how they view this development. John
Tucker, Managing Member, 1st Capital Loans LLC; Peggy
Olson, founder and principal at Strategic Marketing; Steve
Norell, Director of Sales for US Merchant Services Inc.; and
Jeff Fortney, Vice President, ISO Channel Management at
Clearent LLC, all weighed in on the potential success of
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this new marketing move and whether it contains any
takeaways for traditional payment companies.
Court strikes down CFPB action
against payment processors
A federal district court judge in Georgia dismissed a two-
year-old enforcement action brought by the Consumer
Financial Protection Bureau against several payment
processing companies, ruling that the consumer watchdog
agency effectively stonewalled the pretrial discovery
process.
An attorney who follows the CFPB suggested the court's
ruling calls into question the CFPB's understanding of its
enforcement powers. "The CFPB has been successful in
extracting millions of dollars in consent orders without
ever stepping foot in a court room, and certainly without
ever engaging in formal discovery subject to the federal
rules," Joann Needleman, a practice group leader at the
law firm Clark Hill PLC, wrote in a recent blog post at
InsideARM.com. "This case may have pulled back the
curtain and exposed the bureau's inexperience when it
comes to actually litigating a case."
The CFPB filed the civil enforcement action in 2015 against
a group that included four payment processing companies
over an alleged debt collection scheme that got unwitting
consumers to pay off bogus debts. The agency asserted
the payment companies facilitated the
scam by accepting transactions despite
red flags suggesting something was
amiss.
Fitbit lunges into payments
On Aug. 28, 2017, wearable fitness
device brand Fitbit Inc. unveiled its first
smartwatch, Fitbit Ionic. Now available
for presale online, it will be stocked at
retailers globally starting in October.
The Ionic smartwatch features Fitbit
Pay, a contactless payment offering that
has been in development since Fitbit
acquired Silicon Valley-based wearables
payment platform Coin in May 2016.
Fitbit Ionic smartwatch users can appar-
ently pay for items directly from the de-
vice wherever contactless payments are
accepted. "Over the coming months you
will be able to add eligible U.S. Ameri-
can Express cards, as well as Mastercard
and Visa credit and debit cards from top
issuing banks in over 10 markets across
the globe," Fitbit stated, noting that it
plans to expand into additional markets
in the future. During the initial phase,
eligible Visa, Mastercard and AmEx
cardholders tied to participating banks
can make payments using Fitbit Pay.