The ACHBanking payment processing gateway has added Office of Foreign Assets Control standards to its service to better comply with regulations for preventing fund transfers between parties on government watch lists.
ACHBanking, a unit of eProdigy, will follow processes to monitor and screen money exchanges to prevent funding for drug trafficking, terrorism and other illegal activities.
Alternative funding companies like eProdigy have been seeking ways to strengthen their pre-screening of applications in the wake of the U.S. Treasury Department's fine imposed on PayPal in March of 2015 for enabling payments to be processed to or from illegal or suspected entities.
"As we continue to improve processes in our relatively young alternative finance industry, it has become a matter of security to factor in compliance issues such as OFAC," eProdigy CEO David Rubin said in a June 30 press release.
"The recent PayPal case reminds us that the U.S. is a big country with a lot of possible loopholes," Rubin added. "To me, this further demonstrates that technology can go beyond speeding up transactions, to helping us stop potentially dangerous payments to or from a given entity."
The OFAC compliance adds a security layer to eProdigy technology to simplify electronic transactions and ensure legitimacy, the company said.
The system automatically prevents a payer or payee from being created and it disallows particular transactions where a match was identified from ending up in a batch feed that goes to the bank and Nacha.
The ACHBanking processing gateway is available to other merchant funders as well as independent sales organizations. ACHBanking gives merchants and ISOs a platform to process ACH payments and eChecks.
eProdigy's businesses include Capital Stack, 1Workforce, ACHCapital, ACHBanking, eProdigy Loans and DailyFunder.