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Humboldt Merchant Services, an independent sales organization that focuses on payment processing for gambling and adult entertainment, agreed Tuesday to pay $12 million to settle a Federal Trade Commission lawsuit alleging it handled payments for "sham merchant accounts."
Humboldt "processed payments for more than 1,000 merchants that were shell entities that served as fronts or pass-throughs for fraudulent companies engaged in unauthorized billing scams," the Federal Trade Commission said in a Tuesday press release announcing its lawsuit and concurrent settlement agreement.
Humboldt is the business name of 5967 Ventures, a company based in Tempe, Arizona, with an affiliated office in Troy, Michigan, according to the FTC's lawsuit, which was filed Tuesday against 5967 Ventures in the U.S. District Court of Eastern Michigan. The agency filed the settlement agreement at the same time for court approval.
In a statement Tuesday, Humboldt said the agreement "formalizes many processes and controls already put into place," and will close the matter "with no admissions of wrongdoing."

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