Page 43 - GS180601

Education

4. When will an ISO turn to its Having made the transition into the digital realm, ISOs owe it to themselves
contract management system? and their merchant clients to raise their digital contract management standards
accordingly.
Contract management is a daily
grind of archiving contracts formed
and does not yield obvious dividends In publishing The Green Sheet, neither the author nor the publisher is engaged in rendering legal,
on a daily basis. However, every time accounting or other professional services. If legal advice or other expert assistance is required,
an ISO has to look back on an agree- the services of a competent professional should be sought. For further information on this article,
ment – for business negotiations or, please contact Adam Atlas, Attorney at Law via email at atlas@adamatlas.com or by phone at
perhaps, enforcement – all the hard 514-842-0886.
work of managing contracts pays off.

The ultimate payoff of contract man-
agement is, of course, the sale of an
ISO's business. When an ISO owner
seeks to sell the business, the buyer
will inevitably wish to carry out due
diligence. This entails providing key
business information for the poten-
tial buyer to review in order to assess
the value of the ISO.

While the contents of contracts will
evidence the basic value of the busi-
ness, the level of organization of
contract information will also im-
pact the value of the ISO's business.
Put yourself in the shoes of a buyer.
Would your offer-price be influenced
by the level of organization of the
target entity? Naturally, an ISO that
can't show the proof that it really has
all the agent agreements it claims to
have in place, will be less attractive
than an ISO that has kept excellent
records of all agent agreements and
related correspondence.
5. What types of data
security apply?

ISO contracts contain sensitive busi-
ness information pertaining to the
ISO, but they also contain Social Se-
curity numbers and other non-public
personal information of merchants
and merchant-guarantors. ISOs have
a legal duty to keep that information
confidential.

Depending on the circumstances,
that might mean maintaining cer-
tain security protocols with respect
to ISO contracts, such as encryption,
two-factor authentication and other
forms of access control. It could not
hurt to consult a technical advisor on
how to best secure ISO contacts, and
ISO data generally, in order to pre-
empt data breaches.

43