As many folks who've read this blog over the years know, I am, among many other things, a game designer. I've developed a game called Onyx, which I've maintained and sold since the mid-1990s. Onyx is a sex game. It's designed for multiple players, who move around a virtual "game board" buying properties. When another player lands on your property, that player can pay rent or--ahem--work off the debt.
I sell Onyx on my Web site here. It's lived there for many years, and for the past thirteen years or so, I've accepted credit card payments for the registered version of the game via a merchant account provider called Best Payment Solutions.
This past April, I received notification from Best Payment Solutions that they were terminating my account. They gave no reason, other than they "sometimes terminate accounts for risk reasons." In the thirteen years I'd been with them, I'd only had one chargeback--a rather remarkable record I doubt few businesses can match. Didn't matter.
I was told that BPS would no longer work with me, but their parent company, Vantiv, would be happy to give me a merchant account. Vantiv's underwriters, I was told, had looked at my Web site and had no problem with its contents.
So i did the requisite paperwork, turned it all in, and...nothing. For weeks, during which time I was effectively out of business.
Then, four weeks later, I heard back from Vantiv. We're so sorry, they said, we thought we could give you a merchant account, but we can't. When I asked why, the only thing they would say was "risk reasons."
Thus ensued a mad scramble to find a new merchant account underwriter, a process that's normally very time-consuming and tedious. I finally found another underwriter, which I will decline to name for reasons that will become obvious once you read the rest of this post, and I'm back up and running again...but not before I was out of business for over a month.
Onyx registrations pay my rent, so as you might imagine, this has been a stressful time for me.
Okay, that's the backstory. A sad tale of a merchant account underwriter that got cold feet for no clear reason, I thought. Annoying, yes, stressful, you bet. But one of those things that just kind of happens, right? Banks make business decisions all the time. So it goes.
It turns out, though, that I'm not the only one this has happened to. Indeed, it's happened to lots and lots of people. The same pattern, across different businesses and different merchant account providers: A business receives a sudden notification that their merchant account (or in some cases, their business checking account) is being terminated. When they ask why, no answer beyond "risk reasons" is forthcoming. Porn performers, payday loan services, dating sites, fireworks sellers, porn producers, travel clubs...it's a very specific list of folks who are having this problem. And, not surprisingly, there's a reason for it.
The reason is the Department of Justice, which for the past couple of years has undertaken a project they call Operation Choke Point.
The goal of Operation Choke Point is to pressure businesses in morally objectionable fields out of business, by leaning on the banks that provide services to those businesses. If you can't get banking or credit card services, the reasoning goes, you can't stay in business. So the DoJ is approaching commercial banks, telling them to close accounts for individuals and businesses in "objectionable" industries.
It should be noted that the businesses being targeted are not breaking the law. Lawful businesses and individuals are losing access to lawful services because the government objects to them on moral grounds.
The banks being pressured to close accounts are reticent about talking about it; however, one business owner, whose instincts were in the right place, apparently managed to get a recording of a phone call in which his merchant account processor (EFT) told him they were pressured by the government to close the account. His recording has made it to a Congressional hearing looking into the program. (Some banks have reported being told that they would be investigated for racketeering if they failed to close accounts belonging to targeted businesses, despite the fact that the targeted businesses are acting lawfully.)
There's a backlash brewing. Congress is starting to hold hearings about businesses targeted without due process. The DoJ has backtracked. The FDIC, which was involved in pressuring banks to terminate targeted businesses, has reversed course. All that is good. And yet...and yet...
I can't help but think the backlash isn't because people really believe the program was wrong, but rather because it included one industry that is considered politically sacrosanct by the Obama administration's opponents: guns.
In addition to adult businesses, Operation Choke Point targeted small gun and ammo retailers. And there's a small, cynical voice inside my head that whispers, if they had contented themselves with going after people like me--people who make or sell things related to sex--would anyone have cared? The right-wing blogosphere is filled with angry rants about Operation Choke Point, as well it should be...but none of the angry rants mention adult businesses or porn. They all focus on guns. And I just really can't make myself believe that the people rising up against the program have my interests at heart. If it were just me, I believe we wouldn't hear a peep out of them.
Don't get me wrong--for once in my life, I'm glad the Republicans are taking action about something. But I hold no illusions that next time, they will still have my back.
By the time all was said and done, I lost somewhere around $700 from the problems I had. Not a lot, really, in the scheme of things, though I did have to scramble to make rent this month. It could have been worse.
I know there are a lot of folks in various adult-related businesses who read my blog. I'd really love to hear from you guys. Has this happened to you, or anyone you know? What was the outcome? Let me know!