Amidst a small flood of new speculation hitting the Adult webmaster message boards this week, Internet Billing Co. (iBill) insists it will not close its doors and that it is negotiating the release of six-month client Visa reserves said to be held by its now-former processing bank, First Data Bank.
In addition, executive vice president Cathy Beardsley said October 13 that iBill has begun releasing funds to webmasters. "We recognize all past-due amounts," she said responding to queries from AVNOnline.com, "and we will ensure that all clients are brought current on money owed."
Beardsley said First Data still holds clients' Visa reserves and that iBill is working through attorneys to get them released. "At this present time, we would prefer to negotiate with First Data [rather than] litigate."
Some speculation has suggested iBill might be compelled to sue First Data, provoking in turn iBill and First Data being sued by stranded clients, but Beardsley said no additional legal actions have yet been taken.
She also said reserves for clients with iBill’s new processing bank – believed but unconfirmed to be Utah-based Merrick Bank – will be established for clients for a six-month period. Beardsley also re-emphasized that iBill will not close, in spite of rumors that if the company could not resolve its reserves situation it would be out of business within a week.
"iBill has no intentions of closing its doors," Beardsley said emphatically. "As previously stated, iBill is implementing a domestic Visa processing solution and plans to honor any outstanding payments to webmasters." She didn't say exactly when those payments would be made, however.
Earlier this month, iBill announced they were ceasing to process Visa transactions until "proper compliance for our U.S. merchants" was ensured, meaning each U.S.-sponsored merchant would have to complete their new iBill merchant agreement with iBill's new domestic bank. iBill said they would continue processing for other credit cards and payment alternatives without interruption.
Beardsley said "a large portion of our client base" has finished those applications, but iBill isn't doing American processing yet, despite a new start point of October 8 the company announced toward the end of September. "Direct contracts are nearing final approval stages with the bank," she said.
Beardsley also confirmed that new $1,500 Visa fees are being asked of previously existing iBill clients – but at the insistence of its new bank. "It's a requirement of the association," she said, without offering further explanations due to confidentiality requirements.
Last month, iBill's bank agreement with First Data expired and iBill lost a bid in New York State Supreme Court to compel First Data to honor what iBill called an agreement to help it transition to its new bank, whose deal with iBill is due to begin officially November 1.
Almost a week later, iBill announced a deal it said would help the company continue processing, without disclosing who its transitional partner was other than to say it was a domestic acquirer and settlement bank. Two days later, iBill released a formal statement to client webmasters saying that, while continuing to try prying settlement funds out of First Data their top priority is getting their client Webmasters paid.
That statement announced the suspension of Visa transactions until the U.S.-sponsored merchants finished their new merchant agreements with iBill's new domestic bank, while iBill said they would continue processing MasterCard, Discover, JCB, American Express, Online checks, Web 900, and WebPhone transactions.
