Every time I have a similar question I turn to Dp members for your Guidance. Please tell me if this is legitimate or not. We all know that payment processing companies make millions of dollars a year. And we all know that if you want to become a payment processing website, you need to have a certain amount of money in order to be licensed to operate as a payment processing company. My question is: What If I set up a website offshore and offer services to people with lower fees. Do you think that is legal or not? I found this programmer that said that he could make me a website just like Paypal for $1500. At first my main goal was to help people transfer funds from Paypal to Moneybooker or Alertpay or other payment processors for a fee. Customers will have the abilty to send money from my website to any payment processor, and they will also be able to retrive money from any of them. How it will work, Let's say you have payapal but you want to send money to someone that only takes moneybooker (john2514). You will then send money to and then john 2514 will login to my_processing_website.com and send the funds to what ever other money processor he wishes (Paypal, MoneyBooker, AlertPay... Etc). I hope i made myself clear. My main concern is, since I live in the US would I be in trouble if I offer such a service? Also do you think people will trust my website and use it if I offer lower fees. Your input is much appreciated. Thank you in advance.
If you haven't got license to operate the business the cops will call to your door in few days. You will be accused with a RICO court, that is prision for 30 years to life imprisonment because the justice will carry out the process by money laundering, racketeering activity, etc. The best example is eGold, Owner saved his neck because the fbi is managing the company. Offshore world will not allow you without license and nowadays they are rejecting 95% of applications. If you have a license you need many requirements. The first one is to pay the license fee. From 50.000usd in some offshore countries (Without banking support to operate this type of business, eg: swift network) to 1.000.000eur in Europe. You must have the deposit money in the bank accounts always, you can't invest it. Another problem is what is the bank where you are going to support your 1000s transactions every day? You must send and receive money always, also Wolfsberg Group banks reject always these types of companies. Don't trust in that type of companies: 1500 to 100.000... Always is lie. In Europe there are a directive, 50 pages of law, and you are going to supervised by Country Central bank. It is not a kid game. Also, a system to manage this type of business start with 100.000$ because the application behind the scene is incredible. (Algoritms to prevent frauds, connections with credit card companies, customer manegement, API gateways... For example HooPay with license, Moneybookers, with license, PayPal with license, Alertpay, etc. Cheers
Thank you very much for your post, you sue did open my eyes to a lot of things. I read some where that you could start a bank in some countries for only 20.000 dollars would that be as a legitimate thing? Thank you
this business is kind a legal and if you like to operate such a money conversion type you better stay at Rusia since they have more legal about this
I never new that. So you are saying that if the servers were located in Russia it would be ok to do that? Thank you
I would carefully investigate the possibilities to offer such a service before I would go and spend any money on this. It is of course possible to go offshore with your project for instant in Russia, also have your servers hosted in an offshore jurisdiction might be a good start, however it not help you in being an US citizen and to comply with your laws in the US you will need to report your offshore company setup to the respective authorities which again brings you back to that the entire setup is not worth it. Also as mentioned in the thread here, it is against the terms of at least PayPal I’m not aware of moneybookers but it might be the same with them, if they catch you your account get closed and your business is stopped. I like the idea and it would be of great interest for many people using the different e-currencies but it is simply not legit except if you are going to register for a Financial Company regulated by the respective financial authority. It is not to blow off your idea, but you should really go and make some good investigation with professional people.
How about starting an escrow service like the one GAF offers or even escrow.com for that matter. Does that require a license as well?
I recommend you to hire a banking broker, he will help you in all process to open your bank. I recommend the following: - Put your server in good locations, DDoS attacks will kill your banking database if you go offshore because any offshore country have got this type of support. Maybe 1Gbps but it is not enough. Also you must have a security system in servers, Cisco firewall are required with scalable architecture in all countries to be allowed by banking industry standards...For example Casinos have got the primary server in offshore countries (where you pay, etc) but there are more where you play and there are in US. - Don't trust in companies with slogans: Make 100.000$ with out system, Banking system in 2 months!...This type of business require many policies and standars of security. Central Banks of countries will supervise your business 24/7. You must have balance system to prevent attacks, antifraud systems... - Hire accountants, risk managers, customer service, buy a property to locate your headquarters, if it is offshore, arround 300.000$..pay your taxes, if you go offshore you will be required to pay them because it is not an IBC society or basic Ltd. - Pay your license, deposit your guarantee fund. In Europe is 42 millions euros to basic banking. The government of the country will require you to hire people from this country, maybe friends.. - Make deals with all industry to integrate your bank in SWIFT network and TELEX system, try to get an applicattion with VISA and Master Card. - Don't incorporate your bank society in countries where the mafia is involved in the administration unless you are one of them. But these tips are nothing because if you haven't got contacts with politicians or high bankers you will not open a bank because as Oil Companies, the banks are the most supervised and controlled companies by the governments over the world. Hear the voice of experience. Also, since 9/11 the incorporations of banking industry has been reduced in 500%. unless you incorporate a private banking. Because there are lot of types, commercial, private banking, financial banking, offshore banking...Private banking was created to manage great fortunes, you can't operate commercial business as Abbey, JP or others commercial banks. And about 20.000$ license, banking license as Anjouan (Mozambique Channel) are banned by all banking industry. If you open there you can't make a bank wire or SWIFT support, that is you will loose money. And remember, the ecurrencies (they are type of banking) have got licenses: HooPay has got license, Moneybookers, PayPal, Alertpay... Banks are real banking and must have license too. Cheers
I admit that I did not think of that. You made a point right there. Yes I had the intention to do that. That is a great idea, unfortunatly I don't know much about escrow services. I thought of that and that is one thing that worries me the most. I own a lot of websites, one time My account got hacked and they erased all my websites contents. It cost me a lot of money and time to get everything back and running again. I did not know that. Thank you for the information. That is funny. No I m not one of them. That's why I turn to Dp members for guidance Thank you for the info. I did not know that.
If you think about it the paypal website is a very simple website. I don't think it would be that hard to copy.
If you look at it as a user. A PHPbb board is a simple board where people come and post. Login to the admin panel once and you'll know what goes on at the backend. Paypal is by no means a simple site. Right from the time when you login to the different databases it connects to to just display your "My Account" page have a lot of complexities inbuilt. I suggest you re-confirm what you're talking. Deciding the complexities of a website based just on it's frontend is a pretty stupid idea.
What may look stupid to you may not be to others. When I come to DP looking for advice that does not make me a dumb @$$ it means that I m open to other people suggestion. In life there are two kind of people the one that know and love to know more and the one that think they know but don't know nothing. Thank you for taking the time to read my post.
The usage of the word stupid wasn't pointing at you anyways. It was a plain resemblance to a generic term. Apologies if you got offended. Are you trying to imply that I am just acting as a "I know it all" - I take offense, my dear. Sorry for helping you out! Whatever!