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revise model #192

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chadwhitacre opened this Issue Apr 27, 2015 · 73 comments

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chadwhitacre commented Apr 27, 2015

Stripe has raised the specter that we might be engaged in unlicensed money transmission:

The crux of the problem is the stored value: holding funds in a balance that can then be redistributed, in our opinion, qualifies as money transmission, which we cannot support. There are other compounding factors that would make it hard to reason around this property, for example the lack of a concrete product or service being provided.

Over on gratipay/gratipay.com#3321 we learned that a money transmitter is "a business, Business A, that accepts money from Person B and transmits that money to Person C, either at a later time or a different place." We also learned that it's expensive to get licensed (we certainly can't afford it), and that companies have gotten flipped over this in the recent past. Sooooo let's not be a money transmitter! :-)

Stripe suggests two properties of Gratipay that make it a money transmitter:

  • we allow funds to pool indefinitely
  • payments are undirected ("no strings attached")

Is it true that these two properties put us at risk of FinCEN or NYDFS coming after us? What about other properties, such as taking in payments via credit card and paying out via bitcoin?

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chadwhitacre Apr 30, 2015

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Taking discussion private, per #193.

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chadwhitacre commented Apr 30, 2015

Taking discussion private, per #193.

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chadwhitacre May 7, 2015

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Okay, returning from private discussion with @copiesofcopies. Reopening to track the public side of this, I'll continue to communicate with @copiesofcopies privately.

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chadwhitacre commented May 7, 2015

Okay, returning from private discussion with @copiesofcopies. Reopening to track the public side of this, I'll continue to communicate with @copiesofcopies privately.

@chadwhitacre chadwhitacre reopened this May 7, 2015

@chadwhitacre chadwhitacre changed the title from make sure we're not a money transmitter to revise model to qualify for a money transmitter exemption May 7, 2015

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Update: Here is a diagram to accompany this comment and another helpful diagram.


Where to start? Here is a helpful glossary that sets out the following taxonomy under U.S. law:

  • financial institution
    • bank (except bank credit card systems)
    • broker or dealer in securities
    • money services business
      • dealer in foreign exchange
      • check casher
      • issuer or seller of traveler's checks or money orders
      • provider of prepaid access
      • money transmitter
      • U.S. Postal Service
      • seller of prepaid access
    • telegraph company
    • casino
    • person subject to supervision by any state or Federal bank supervisory authority
    • futures commission merchant
    • introducing broker in commodities
    • mutual fund

The definition of a money transmitter is simple and broad:

Money transmitter—(i) In general. (A) A person that provides money transmission services. [...]

(B) Any other person engaged in the transfer of funds.

There are six possible exceptions to the money transmitter definition, two of which are interesting to us:

(ii) Facts and circumstances; Limitations. Whether a person is a money transmitter as described in this section is a matter of facts and circumstances. The term “money transmitter” shall not include a person that only:

[...]

(B) Acts as a payment processor to facilitate the purchase of, or payment of a bill for, a good or service through a clearance and settlement system by agreement with the creditor or seller;

[...]

(F) Accepts and transmits funds only integral to the sale of goods or the provision of services, other than money transmission services, by the person who is accepting and transmitting the funds.

These are the "payment processor exemption," and the "goods and services exemption."

The way the latter would work is that we would insert ourselves more full into the delivery process. For example, we might verify that open source projects deliver legitimate releases before releasing funds (think: Kickstarter project completion).

The former, the payment processor exemption, seems to me to be a more natural fit for Gratipay, and this seems to be the one Stripe is trying to fit us into. Here's FinCEN's comment in a big 2011 publication:

Although payment processors may provide a money transmission service, the service is ancillary to their primary business of coordinating payments either from a debtor to a creditor or, if operating at the point of sale, from a purchaser to a merchant. A payment processor could not provide the primary service of coordination without providing ancillary money transmission services, but because the money transmission services are ancillary, and because they are generally low risk, it is appropriate for entities engaged in this activity to be excluded from the definition. Note, however, that this limitation only applies to transmission services by payment processors on behalf of the creditor or seller and not the debtor or buyer. A contractual agreement for transmission services between the creditor or seller and the money transmitter is a relatively controlled flow of money that poses little money laundering risk, provided that the funds are transmitted only to the creditor or seller with whom the payment processor has contracted and not to another location or person.

And here are the four criteria they seem to have settled on in their rulings (e.g.):

  1. the entity providing the service must facilitate the purchase of goods or services, or the payment of bills for goods or services (other than money transmission itself);
  2. the entity must operate through clearance and settlement systems that admit only BSA-regulated financial institutions;
  3. the entity must provide the service pursuant to a formal agreement; and
  4. the entity’s agreement must be at a minimum with the seller or creditor that provided the goods or services and receives the funds.

Points 3 and 4 we already have, and if we don't it should be a straightforward update to our terms. Point 2 means forgoing bitcoin (that's okay, we've only done 4 bitcoin payouts vs. 516 ACH credits and 468 PayPal payouts since we started keeping better track with gratipay/gratipay.com#3282). Point 1 is the more interesting part. This is the part where we need to attach strings, or as Stripe put it at gratipay/gratipay.com#3324 (comment), "make it clear that this is intended to support actual services."

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chadwhitacre commented May 7, 2015


Update: Here is a diagram to accompany this comment and another helpful diagram.


Where to start? Here is a helpful glossary that sets out the following taxonomy under U.S. law:

  • financial institution
    • bank (except bank credit card systems)
    • broker or dealer in securities
    • money services business
      • dealer in foreign exchange
      • check casher
      • issuer or seller of traveler's checks or money orders
      • provider of prepaid access
      • money transmitter
      • U.S. Postal Service
      • seller of prepaid access
    • telegraph company
    • casino
    • person subject to supervision by any state or Federal bank supervisory authority
    • futures commission merchant
    • introducing broker in commodities
    • mutual fund

The definition of a money transmitter is simple and broad:

Money transmitter—(i) In general. (A) A person that provides money transmission services. [...]

(B) Any other person engaged in the transfer of funds.

There are six possible exceptions to the money transmitter definition, two of which are interesting to us:

(ii) Facts and circumstances; Limitations. Whether a person is a money transmitter as described in this section is a matter of facts and circumstances. The term “money transmitter” shall not include a person that only:

[...]

(B) Acts as a payment processor to facilitate the purchase of, or payment of a bill for, a good or service through a clearance and settlement system by agreement with the creditor or seller;

[...]

(F) Accepts and transmits funds only integral to the sale of goods or the provision of services, other than money transmission services, by the person who is accepting and transmitting the funds.

These are the "payment processor exemption," and the "goods and services exemption."

The way the latter would work is that we would insert ourselves more full into the delivery process. For example, we might verify that open source projects deliver legitimate releases before releasing funds (think: Kickstarter project completion).

The former, the payment processor exemption, seems to me to be a more natural fit for Gratipay, and this seems to be the one Stripe is trying to fit us into. Here's FinCEN's comment in a big 2011 publication:

Although payment processors may provide a money transmission service, the service is ancillary to their primary business of coordinating payments either from a debtor to a creditor or, if operating at the point of sale, from a purchaser to a merchant. A payment processor could not provide the primary service of coordination without providing ancillary money transmission services, but because the money transmission services are ancillary, and because they are generally low risk, it is appropriate for entities engaged in this activity to be excluded from the definition. Note, however, that this limitation only applies to transmission services by payment processors on behalf of the creditor or seller and not the debtor or buyer. A contractual agreement for transmission services between the creditor or seller and the money transmitter is a relatively controlled flow of money that poses little money laundering risk, provided that the funds are transmitted only to the creditor or seller with whom the payment processor has contracted and not to another location or person.

And here are the four criteria they seem to have settled on in their rulings (e.g.):

  1. the entity providing the service must facilitate the purchase of goods or services, or the payment of bills for goods or services (other than money transmission itself);
  2. the entity must operate through clearance and settlement systems that admit only BSA-regulated financial institutions;
  3. the entity must provide the service pursuant to a formal agreement; and
  4. the entity’s agreement must be at a minimum with the seller or creditor that provided the goods or services and receives the funds.

Points 3 and 4 we already have, and if we don't it should be a straightforward update to our terms. Point 2 means forgoing bitcoin (that's okay, we've only done 4 bitcoin payouts vs. 516 ACH credits and 468 PayPal payouts since we started keeping better track with gratipay/gratipay.com#3282). Point 1 is the more interesting part. This is the part where we need to attach strings, or as Stripe put it at gratipay/gratipay.com#3324 (comment), "make it clear that this is intended to support actual services."

@chadwhitacre chadwhitacre changed the title from revise model to qualify for a money transmitter exemption to revise model to fit a money transmitter exemption May 8, 2015

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The basic idea here with the payment processor exemption is that we would implement an application process to become a receiver on Gratipay, and we would vet applicants based on what they were receiving money for. This gives us a chance to vet for brand fit (#187). We also want to require a working payout route, and since we're going to have everyone reapply anyway we can reprompt for payout info since it looks at gratipay/gratipay.com#3379 (comment) like we won't be getting that from Balanced.

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chadwhitacre commented May 8, 2015

The basic idea here with the payment processor exemption is that we would implement an application process to become a receiver on Gratipay, and we would vet applicants based on what they were receiving money for. This gives us a chance to vet for brand fit (#187). We also want to require a working payout route, and since we're going to have everyone reapply anyway we can reprompt for payout info since it looks at gratipay/gratipay.com#3379 (comment) like we won't be getting that from Balanced.

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This also lines up with narrowing our focus (#180).

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chadwhitacre commented May 8, 2015

This also lines up with narrowing our focus (#180).

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bayprogrammer May 8, 2015

I'm not sure if it really relates, but it keeps popping in my mind, so I'll mention it here. The donation model of Vim specifically avoids a "direct relationship" between Bram's work and doners, so that Bram doesn't incur tax liability for money he passes directly to charity. Perhaps relevant as you consider how the new proposed model might impact uses.

I donated $$$, now please add feature XYZ!

There is no direct relation between your donation and the work Bram does. Otherwise you would be paying for work and Bram has to pay income tax over the donation. If you want to hire Bram for specific work, contact him directly, don't use the donation system.

Source: http://www.vim.org/sponsor/faq.php

I'm guessing that sort of arrangement isn't what Gratipay is really about, but I figured I'd bring it up just in case it's relevant.

bayprogrammer commented May 8, 2015

I'm not sure if it really relates, but it keeps popping in my mind, so I'll mention it here. The donation model of Vim specifically avoids a "direct relationship" between Bram's work and doners, so that Bram doesn't incur tax liability for money he passes directly to charity. Perhaps relevant as you consider how the new proposed model might impact uses.

I donated $$$, now please add feature XYZ!

There is no direct relation between your donation and the work Bram does. Otherwise you would be paying for work and Bram has to pay income tax over the donation. If you want to hire Bram for specific work, contact him directly, don't use the donation system.

Source: http://www.vim.org/sponsor/faq.php

I'm guessing that sort of arrangement isn't what Gratipay is really about, but I figured I'd bring it up just in case it's relevant.

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chadwhitacre May 8, 2015

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Thanks for the brainstorm, @bayprogrammer.

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chadwhitacre commented May 8, 2015

Thanks for the brainstorm, @bayprogrammer.

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sc0ttkclark May 8, 2015

Concerning for sure, but excited to see where this lands. I really liked how Gratipay works!

sc0ttkclark commented May 8, 2015

Concerning for sure, but excited to see where this lands. I really liked how Gratipay works!

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I was hoping I wouldn't have to fork Gratipay, but every day it's looking more and more like I'm gonna have to.

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Changaco commented May 8, 2015

I was hoping I wouldn't have to fork Gratipay, but every day it's looking more and more like I'm gonna have to.

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lpalgarvio May 8, 2015

@Changaco, without knowing much about gratiplay or the development efforts, or any of you developers, I ask that You put Your energy into constructive thinking and discussion, instead of making claims.

If You want to fork it, just fork it. But please don't come here with this kind of attitude.
If I was any of the admins of the project and had power, your comment would had been erased the moment it was posted. It's inconstructive, disrespectful and conflictuous, and add nothing good to the project.

lpalgarvio commented May 8, 2015

@Changaco, without knowing much about gratiplay or the development efforts, or any of you developers, I ask that You put Your energy into constructive thinking and discussion, instead of making claims.

If You want to fork it, just fork it. But please don't come here with this kind of attitude.
If I was any of the admins of the project and had power, your comment would had been erased the moment it was posted. It's inconstructive, disrespectful and conflictuous, and add nothing good to the project.

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The members of the Gratipay team know that I am never intentionally non-constructive, disrespectful or conflictive. As a matter of fact my comment was intended to be the opposite: even though I have no obligation to inform the Gratipay team of a possible fork, I feel it is more respectful and less conflictive to do so than to keep it "secret".

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Changaco commented May 8, 2015

The members of the Gratipay team know that I am never intentionally non-constructive, disrespectful or conflictive. As a matter of fact my comment was intended to be the opposite: even though I have no obligation to inform the Gratipay team of a possible fork, I feel it is more respectful and less conflictive to do so than to keep it "secret".

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The members of the Gratipay team know that I am never intentionally non-constructive

#192 (comment) sure did seem disrespectful and non-constructive to me. "I'm going to fork Gratipay, I thought I'd let you know" would have been respectful and less conflictive :)

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rohitpaulk commented May 8, 2015

The members of the Gratipay team know that I am never intentionally non-constructive

#192 (comment) sure did seem disrespectful and non-constructive to me. "I'm going to fork Gratipay, I thought I'd let you know" would have been respectful and less conflictive :)

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lpalgarvio May 8, 2015

It's not the matter of making a fork or announcing/not announcing it to them.
It's announcing it publicly on their issue queue/project space, with this attitude.

That is like receiving an invitation to a friend's party. and then publicly decline it, with a paper in front of their house, saying you have better plans. It's not polite nor respectful.

To be polite and respectful, you would announce it first, privately to the developers, then publicly, but not here, and not in this way, with this kind of speech. I wonder if a "here's a fork" new issue would be correct.

But it's my opinion.

Cheers @rohitpaulk

lpalgarvio commented May 8, 2015

It's not the matter of making a fork or announcing/not announcing it to them.
It's announcing it publicly on their issue queue/project space, with this attitude.

That is like receiving an invitation to a friend's party. and then publicly decline it, with a paper in front of their house, saying you have better plans. It's not polite nor respectful.

To be polite and respectful, you would announce it first, privately to the developers, then publicly, but not here, and not in this way, with this kind of speech. I wonder if a "here's a fork" new issue would be correct.

But it's my opinion.

Cheers @rohitpaulk

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mw44118 May 8, 2015

Just came here to say that I hope this doesn't stop the project. Gratipay is exciting!

mw44118 commented May 8, 2015

Just came here to say that I hope this doesn't stop the project. Gratipay is exciting!

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Maybe the comment could have been worded better, in any case I see no point in discussing this further, Chad will delete my comments if he doesn't like them, or move them to another issue if he feels that's more appropriate.

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Changaco commented May 8, 2015

Maybe the comment could have been worded better, in any case I see no point in discussing this further, Chad will delete my comments if he doesn't like them, or move them to another issue if he feels that's more appropriate.

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@lpalgarvio Changaco has a long history with the project, and was in fact our top developer until recently. He's well-known around here and I see no problem with his comment, nor with him forking. We've had one fork already, and we were happy to try to help them (#70).

@Changaco Thanks for the heads-up. It does seem like there's room for a Gratipay alternative for the (as I'm reading it) stridently libertarian crowd. If you decide to fork, let us know how we can help. :-)

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chadwhitacre commented May 8, 2015

@lpalgarvio Changaco has a long history with the project, and was in fact our top developer until recently. He's well-known around here and I see no problem with his comment, nor with him forking. We've had one fork already, and we were happy to try to help them (#70).

@Changaco Thanks for the heads-up. It does seem like there's room for a Gratipay alternative for the (as I'm reading it) stridently libertarian crowd. If you decide to fork, let us know how we can help. :-)

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tshepang May 8, 2015

@whit537 why would you want to help with the fork?

tshepang commented May 8, 2015

@whit537 why would you want to help with the fork?

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@tshepang Why wouldn't I? @Changaco is great, and I want to see him succeed. I made the same offer to the previous fork (#70).

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chadwhitacre commented May 8, 2015

@tshepang Why wouldn't I? @Changaco is great, and I want to see him succeed. I made the same offer to the previous fork (#70).

@chadwhitacre chadwhitacre changed the title from revise model to fit a money transmitter exemption to revise model May 8, 2015

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A user writes:

My volunteered vote as a customer is for you to switch to bitcoin.
I know there may be issues that I am not aware of in regards to the marriage of bitcoin to your business (other than ubiquity of dollars vs bitcoin's relatively minor market share as a transfer of value) but if it was possible for you, especially seeing as how USD and our fiat currency system (and the relevant regulation) is failing to provide flexibility to a legitimate business model such as yours, your customers like myself will continue to support you.
Its a stretch I know, especially not being the one that would have to do the work that you are faced with, but perhaps this can even turn out for the better for Gratipay. Here's hoping!

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chadwhitacre commented May 8, 2015

A user writes:

My volunteered vote as a customer is for you to switch to bitcoin.
I know there may be issues that I am not aware of in regards to the marriage of bitcoin to your business (other than ubiquity of dollars vs bitcoin's relatively minor market share as a transfer of value) but if it was possible for you, especially seeing as how USD and our fiat currency system (and the relevant regulation) is failing to provide flexibility to a legitimate business model such as yours, your customers like myself will continue to support you.
Its a stretch I know, especially not being the one that would have to do the work that you are faced with, but perhaps this can even turn out for the better for Gratipay. Here's hoping!

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mixolidia May 13, 2015

Thanks for your suggestions @whit537, I've been receiving donations for a personal project according to what the terms were when I signed up four months ago. I call them donations because people are not expecting any particular product in return. I do contribute to the tech community, there just is not one specific app. I did marketing on my own to receive funds in my Gratipay account. I mean I was on Gratipay and didn't start getting tips until I started telling people about it. I think I know some of them and some people have contacted to tell me about their support. But all my the tips are anonymous, so I can't contact them to let them know of the changes directly. And how the relationship they have with me through Gratipay may be affected.

I read how teams work on Gratipay, is that how they will still work moving forward? So if I migrate into a team the funds I fund-raised will be distributed equally among all team members? I'm very grateful for Gratipay's help with the transactions in my fund-raising for my projects. I'm just trying to be clear on my options since all these changes have really impacted my budget for next month.

mixolidia commented May 13, 2015

Thanks for your suggestions @whit537, I've been receiving donations for a personal project according to what the terms were when I signed up four months ago. I call them donations because people are not expecting any particular product in return. I do contribute to the tech community, there just is not one specific app. I did marketing on my own to receive funds in my Gratipay account. I mean I was on Gratipay and didn't start getting tips until I started telling people about it. I think I know some of them and some people have contacted to tell me about their support. But all my the tips are anonymous, so I can't contact them to let them know of the changes directly. And how the relationship they have with me through Gratipay may be affected.

I read how teams work on Gratipay, is that how they will still work moving forward? So if I migrate into a team the funds I fund-raised will be distributed equally among all team members? I'm very grateful for Gratipay's help with the transactions in my fund-raising for my projects. I'm just trying to be clear on my options since all these changes have really impacted my budget for next month.

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I read how teams work on Gratipay, is that how they will still work moving forward?

More or less. First draft of terms will drop soon on gratipay/gratipay.com#3390 and that'll have the details, so watch that ticket as well.

So if I migrate into a team the funds I fund-raised will be distributed equally among all team members?

That's up to you. Gratipay Payroll has one distribution algorithm right now (and it's not "equal shares," it's "take what you want, kids eat first"). If you want a different distribution algorithm it's fine to do that outside of Gratipay. You'll just need to explain on your Team page what the distribution algorithm is. See gratipay/gratipay.com#3390 for more discussion of this.

[T]hese changes have really impacted my budget for next month.

Yeah, I'm sorry. We're in the same ⛵️, at least. :-(

I've been receiving donations for a personal project

@mixolidia What's the project? What product or service is the project delivering? How can others get involved to help you with it? How will you share with contributors any revenue the project generates? As long as you've got solid answers to those questions (and can otherwise agree to our in-the-oven terms), then you can migrate your existing payments to a Team for your project. Let's find a way to make that happen! :-)

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chadwhitacre commented May 13, 2015

I read how teams work on Gratipay, is that how they will still work moving forward?

More or less. First draft of terms will drop soon on gratipay/gratipay.com#3390 and that'll have the details, so watch that ticket as well.

So if I migrate into a team the funds I fund-raised will be distributed equally among all team members?

That's up to you. Gratipay Payroll has one distribution algorithm right now (and it's not "equal shares," it's "take what you want, kids eat first"). If you want a different distribution algorithm it's fine to do that outside of Gratipay. You'll just need to explain on your Team page what the distribution algorithm is. See gratipay/gratipay.com#3390 for more discussion of this.

[T]hese changes have really impacted my budget for next month.

Yeah, I'm sorry. We're in the same ⛵️, at least. :-(

I've been receiving donations for a personal project

@mixolidia What's the project? What product or service is the project delivering? How can others get involved to help you with it? How will you share with contributors any revenue the project generates? As long as you've got solid answers to those questions (and can otherwise agree to our in-the-oven terms), then you can migrate your existing payments to a Team for your project. Let's find a way to make that happen! :-)

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First draft of new terms is up at gratipay/gratipay.com#3408.

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chadwhitacre commented May 13, 2015

First draft of new terms is up at gratipay/gratipay.com#3408.

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mixolidia May 14, 2015

@whit537 Thank you for your response. I think I can migrate, but I guess Gratipay will be the judge of that. Also, I've been following along today. Is there going to be an email to start the migration telling how? Or do I just go into my account and change to team?

mixolidia commented May 14, 2015

@whit537 Thank you for your response. I think I can migrate, but I guess Gratipay will be the judge of that. Also, I've been following along today. Is there going to be an email to start the migration telling how? Or do I just go into my account and change to team?

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I think I can migrate

Huzzah! Happy to discuss your application here with you if you want, or privately on support@gratipay.com if you're more comfortable with that. Let's see if we can find a way to make it work. What's the project you're planning to apply with?

Is there going to be an email to start the migration telling how?

We'll share a link when it's ready. You can follow along on gratipay/gratipay.com#3399, that's where the action is and that'll be the first place we announce the application link. We are planning to run payday tomorrow with just a few teams, the ones paying close attention, such as yourself. We'll beta test the new system this week and then blast out an email and blog post ahead of next week.

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chadwhitacre commented May 14, 2015

I think I can migrate

Huzzah! Happy to discuss your application here with you if you want, or privately on support@gratipay.com if you're more comfortable with that. Let's see if we can find a way to make it work. What's the project you're planning to apply with?

Is there going to be an email to start the migration telling how?

We'll share a link when it's ready. You can follow along on gratipay/gratipay.com#3399, that's where the action is and that'll be the first place we announce the application link. We are planning to run payday tomorrow with just a few teams, the ones paying close attention, such as yourself. We'll beta test the new system this week and then blast out an email and blog post ahead of next week.

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mixolidia May 14, 2015

Thank you! @whit537 I sent an email.

mixolidia commented May 14, 2015

Thank you! @whit537 I sent an email.

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chadwhitacre May 14, 2015

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Okay! New terms are done, and applications for new teams are now open!

https://gratipay.com/new

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chadwhitacre commented May 14, 2015

Okay! New terms are done, and applications for new teams are now open!

https://gratipay.com/new

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With that, I'm going to close this ticket. See you on gratipay/gratipay.com#3399!

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chadwhitacre commented May 14, 2015

With that, I'm going to close this ticket. See you on gratipay/gratipay.com#3399!

@chadwhitacre chadwhitacre added bot/Radar and removed bot/Radar labels May 22, 2015

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chadwhitacre commented May 22, 2015

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JanelleOrsi May 31, 2015

I haven't been following this conversation closely enough, but in case it's relevant, the CA Department of Business Oversight has opened a new comment period on a proposed amendment to the Money Transmission Act and comments are due June 4: http://www.dbo.ca.gov/Licensees/money_transmitters/Regulations.asp

It's only worth commenting on if you think check sellers, bill payers, and proraters licensed under the Check Sellers, Bill Payers, and Proraters Law (Fin. Code, § 12000 et seq.) should be exempt from the Money Transmission Act. It certainly sounds like overkill to make them get licensed twice. But I haven't looked closely enough to see how check sellers, bill payers, and proraters are defined.

JanelleOrsi commented May 31, 2015

I haven't been following this conversation closely enough, but in case it's relevant, the CA Department of Business Oversight has opened a new comment period on a proposed amendment to the Money Transmission Act and comments are due June 4: http://www.dbo.ca.gov/Licensees/money_transmitters/Regulations.asp

It's only worth commenting on if you think check sellers, bill payers, and proraters licensed under the Check Sellers, Bill Payers, and Proraters Law (Fin. Code, § 12000 et seq.) should be exempt from the Money Transmission Act. It certainly sounds like overkill to make them get licensed twice. But I haven't looked closely enough to see how check sellers, bill payers, and proraters are defined.

@chadwhitacre chadwhitacre referenced this issue Aug 28, 2015

Closed

payout via dwolla masspay #726

0 of 1 task complete

@chadwhitacre chadwhitacre referenced this issue Dec 21, 2015

Closed

Radar 37 #439

chadwhitacre added a commit to gratipay/gratipay.com that referenced this issue Nov 17, 2016

Resolve Project -> {Collaborator,Giver} asymmetry
The four criteria for our payment processor exemption to regulation as a
money transmitter are:[1]

  1. we must facilitate the purchase of goods or services, or the
     payment of bills for goods or services;

  2. we must operate through clearance and settlement systems that
     admit only BSA-regulated financial institutions;

  3. we must provide our service pursuant to a formal agreement; and

  4. our agreement must be at a minimum with the seller that
     provides the goods or services and receives the funds.

Therefore, I think it's a good idea to state right up front that we are
"a platform to facilitate payments for goods or services." This also
gives us a chance to define Work before referring to it later.

I don't believe that the "to facilitate this agreement" language that
this PR removes is entangled with our regulatory status. Instead, this
PR simplifies those clauses by referring to "any agreement."

[1] gratipay/inside.gratipay.com#192 (comment)

chadwhitacre added a commit to gratipay/gratipay.com that referenced this issue Nov 29, 2016

Resolve Project -> {Collaborator,Giver} asymmetry
The four criteria for our payment processor exemption to regulation as a
money transmitter are:[1]

  1. we must facilitate the purchase of goods or services, or the
     payment of bills for goods or services;

  2. we must operate through clearance and settlement systems that
     admit only BSA-regulated financial institutions;

  3. we must provide our service pursuant to a formal agreement; and

  4. our agreement must be at a minimum with the seller that
     provides the goods or services and receives the funds.

Therefore, I think it's a good idea to state right up front that we are
"a platform to facilitate payments for goods or services." This also
gives us a chance to define Work before referring to it later.

I don't believe that the "to facilitate this agreement" language that
this PR removes is entangled with our regulatory status. Instead, this
PR simplifies those clauses by referring to "any agreement."

[1] gratipay/inside.gratipay.com#192 (comment)

chadwhitacre added a commit to gratipay/gratipay.com that referenced this issue Dec 7, 2016

Resolve Project -> {Collaborator,Giver} asymmetry
The four criteria for our payment processor exemption to regulation as a
money transmitter are:[1]

  1. we must facilitate the purchase of goods or services, or the
     payment of bills for goods or services;

  2. we must operate through clearance and settlement systems that
     admit only BSA-regulated financial institutions;

  3. we must provide our service pursuant to a formal agreement; and

  4. our agreement must be at a minimum with the seller that
     provides the goods or services and receives the funds.

Therefore, I think it's a good idea to state right up front that we are
"a platform to facilitate payments for goods or services." This also
gives us a chance to define Work before referring to it later.

I don't believe that the "to facilitate this agreement" language that
this PR removes is entangled with our regulatory status. Instead, this
PR simplifies those clauses by referring to "any agreement."

[1] gratipay/inside.gratipay.com#192 (comment)
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