EFTA01382708.pdf

S-1/A Table of Contra& an issuer's debit cards and prohibit card issuers and payment networks from inhibiting the ability of merchants to direct the routing of debit card transactions over any network that can process the transaction. Beginning April 1. 2012. all debit card issuers in the United States were required to participate in at least two unaffiliated debit payment card networks. On April I. 2013. the ban on network exclusivity arrangements became effective for prepaid card and healthcare debit card issuers, with certain exceptions for prepaid cards issued before that date. Effective July 22, 2010, merchants were allowed to set minimum dollar amounts (not to exceed 510) for the acceptance of a credit card (while federal governmental entities and institutions of higher education may set maximum amounts for the acceptance of credit cards). They were also allowed to provide discounts or incentives to entice consumers to pay with an alternative payment method, such as cash, checks or debit cards. In addition, the Dodd-Frank Act created a new entity. the Financial Stability Oversight Council, and authorized it to require that a nonbank financial company that is deemed to pose a systemic risk to the U.S. financial system become &abject to consolidated, prudential supervision by the Federal Reserve Board. At this point it is unclear whether we would be subject to additional systemic risk related oversight. Association andNetwork Rules We are subject to rules of MasterCard. Visa, INTERAC. PULSE, and other payment networks, In order to provide processing services, a number of our subsidiaries are registered with Visa and/or MasterCard as service providers for member institutions. Various subsidiaries of ours arc also processor level members of numerous debit and electronic benefits transaction networks or arc otherwise subject to various network rules in connection with processing services and other services we provide. As such, we arc subject to applicable card association. network. and national scheme rules that could subject us to fines or penalties. We are also subject to network operating roles promulgated by the National Automated Clearing [louse Association relating to payment transactions processed by us using the Automated Clearing I louse Network and to various state and federal laws regarding such operations, including laws pertaining to electronic benefits transaction. Cashcard Australia Limited (Casitcard) is a member of the Australian Consumer Electronic Clearing System (CECS), which is a debit payment system regulated by network operating rules established and administered by Australian Payments Clearing Association Limited, and is a member of the ATM Access Australia Limited and the eftpos Access Australia Limited that administer reciprocal access and interchange arrangements for ATMs and Electronic Funds Transfer at Point of Sale (eftpos), respectively, in Australia. The network operating rules. ATM Access Code and eftpos Access Code impose a variety of sanctions, including suspension or termination of membership and fines for non- compliance. Cashcard also operates its own network of members, regulated by rules promulgated by Cashcard. To enable Cashcard to settle in CECS directly with banks and financial institutions, Cashcard maintains an Exchange Settlement Account which is supervised by the Reserve Bank of Australia (RIM), and that requires Cashcard to adhere to conditions imposed by RBA. Our subsidiary in Germany, TcleCash GmbH & Co. KG, is certified and regulated as a processor for domestic German debit card transactions by the Deutsche Kreditwirtschaft (DK), the German banking association. Failure to comply with the technical requirements set forth by the DK may result in suspension or termination of services. Banking Regulations Because a number of our subsidiary businesses provide data processing services for financial institutions, we are subject to examination by the Federal Financial Institutions Examination Council, which examines large data processors in order to identify and mitigate risks associated with significant service providers. FDR Limited is authorized and regulated in the United Kingdom by the Financial Conduct Authority, one of the two principal financial markets regulators in the United Kingdom. FDR Limited is authorized by the Financial Conduct Authority to arrange and advise on certain insurance contracts for the purpose of arranging 152 http://vanv.see.gov/Archi vecledgaddataht83980/000119312515334479/(B1022dsla.htmi10/14/2015 9:06:38 AM] CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0082171 CONFIDENTIAL SDNY GM_00228355 EFTA01382708