recent thread on GS Online's MLS Forum reflected the participants' confusion and concern over the implications of what happens when a processor cuts off merchant accounts without warning.

The discussion addressed a letter that a merchant had received from PaySystems Corp., of Montreal, and its third party billing subsidiary, myPaySystems.

The letter informed the merchant that "due to circumstances beyond [its] control," myPaySystems was forced to "terminate our Internet Billing Account (IBA) services."

According to Todd Whitton of PaySystem's Long Island, N.Y. office, the company is indeed ending its aggregate business, which as he put it, "helped facilitate merchants who may have had difficulty getting accounts on their own. These could be high-risk, international, travel clubs or online merchants," he said, stressing that myPaySystems did not work with adult or gambling merchants.

As an IBA, or third-party biller, myPaySytems had its master merchant account with Pago eTransaction Services GmbH and Deutsche Bank. "We could not come to terms regarding certain provisions in the plans with Pago," Whitton said. Pago did not respond to an e-mail message from The Green Sheet for comment.

The decision impacts over 1,000 merchants. "We're taking steps to rectify outstanding issues and working diligently to develop a plan and find ways to pay off the affected merchants," Whitton said. "There is a migration plan in place with Pago, and we're working to refer them to other processors."

He said the company has not actively pursued agents for its IBAs for some time and has steadily reduced its third party business over the past several months.

"Our strategic plan is to move toward the merchant account model and executing traditional merchant services," Whitton said. "We've been gradually moving away from the aggregate business, which is not the favorite of the Associations."

"Our U.S. portfolio has been very conservative. But we're now taking a more aggressive approach, and we are seeing double-digit growth every month," Whitton said.