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Focus on US Prepaid Vulnerabilities Overlooks Exploitation of Foreign-Issued Cards

By Colby Adams

As U.S. officials work to shield American prepaid cards from abuse by financial crooks, foreign-issued stored value products remain a relatively easy avenue to move money into the United States anonymously. Final rules issued by the Treasury Department's Financial Crimes Enforcement Network, or FinCEN, in July 2011, imposed anti-money laundering program duties on American providers and sellers of certain prepaid products, including customer-identification, suspicious-activity-reporting and transaction-recordkeeping requirements. But reloadable cards that can be acquired in person or over the internet from foreign financial institutions remain an immediate threat, according to a senior compliance officer at a major U.S. financial institution...

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