Illinois Officials Issue Cease and Desist Order Against Square

By Ed Silverstein March 01, 2013

Square – the mobile payments company – was the subject of a cease and desist order from the Illinois Department of Financial & Professional Regulation.

The order means that the company has to stop “offering or providing money transmission services” in Illinois. The company also has to show documents, records and other statements for Illinois consumers, related to the transmission of money made to or from Illinois consumers, and independent reviews of Square’s anti-money laundering program. Also, Square is liable to the state for $1,000 a violation.

TechCrunch says the order relates to an Illinois law known as the Transmitters of Money Act.

“Transmitting money’ means the transmission of money by any means, including transmissions to or from locations within the United States or to and from locations outside of the United States by payment instrument, facsimile or electronic transfer, or otherwise, and includes bill payment services,” the order explained.

“No person may engage in this State in the business of selling or issuing payment instruments, transmitting money, or exchanging, for compensation, payment instruments or money of the United States government or a foreign government to or from money of another government without first obtaining a license under this Act.”

Therefore, it appears that Square needs a license to transmit payments in the state, TechCrunch said, but it is unlikely Illinois operations will be shut down for Square. Violations of the act represent a Class 3 felony under state law.

Meanwhile, Square said in a statement, “We’ve been in close contact with the Illinois Division of Financial Institutions for several months and are addressing their concerns.”

One blogger, Thomas Noyes, who is the former head of Citi global channels said, “I completely disagree with IL regulators.” He was believed to be the first person to report on the order – based on his tweets.




Edited by Brooke Neuman

TechZone360 Contributor

SHARE THIS ARTICLE
Related Articles

Bloomberg BETA: Models Are Key to Machine Intelligence

By: Paula Bernier    4/19/2018

James Cham, partner at seed fund Bloomberg BETA, was at Cisco Collaboration Summit today talking about the importance of models to the future of machi…

Read More

Get Smart About Influencer Attribution in a Blockchain World

By: Maurice Nagle    4/16/2018

The retail value chain is in for a blockchain-enabled overhaul, with smarter relationships, delivering enhanced transparency across an environment of …

Read More

Facebook Flip-Flopping on GDPR

By: Maurice Nagle    4/12/2018

With GDPR on the horizon, Zuckerberg in Congress testifying and Facebook users questioning loyalty, change is coming. What that change will look like,…

Read More

The Next Phase of Flash Storage and the Mid-Sized Business

By: Joanna Fanuko    4/11/2018

Organizations amass profuse amounts of data these days, ranging from website traffic metrics to online customer surveys. Collectively, AI, IoT and eve…

Read More

Satellite Imaging - Petabytes of Developer, Business Opportunities

By: Doug Mohney    4/11/2018

Hollywood has programmed society into believing satellite imaging as a magic, all-seeing tool, but the real trick is in analysis. Numerous firms are f…

Read More