Operation ChokePoint: Who Should Regulate the Payment Industry?

In an effort to reduce fraudulent payment practices, the government has formed an initiative called “Operation ChokePoint,” an effort that shifts the burden of enforcement from individual merchants to processors that deal with the class of merchants the feds are targeting. While the card not present (CNP) is a fraudulent hotbed, this move has sparked controversy within the payment industry.

Who should be responsible for regulation? Many payment industry executives feel it’s best left to the payment professionals and those within the payment acceptance landscape to act in their own best interests. MasterCard utilizes its MATCH (Member Alert to Control High-Risk Merchants) in an effort to self-police.

Those in the payment acceptance industry are doing their part to prevent fraudulent activity with similar programs and fraud prevention solutions.

It remains to be seen how involved the government will become involved in the issue, or if legislation will even make any impact against fraudulent activity.