from – www.infosecurity-magazine.com – Visa, the international payment card group, has taken the unprecedented step of suspending the Visa transaction processing facilities of one of its prepaid debit card members, ePassporte.

ePassporte has two main consumer services, an internet payment facility and a physical Visa-branded debit card that can be used in ATMs and physical shops. The facility is used by a large number of people in the US, as well as around the world.

Businesses, meanwhile, use ePassporte as a low-cost method of accepting debit and credit card transactions via their online retail websites. Funds are typically wired to bank accounts any where in the world 15 days after the transaction is processed, or can be withdrawn from a Visa-branded ATM using a Visa Electron card supplied by the firm.

Visa isn’t saying why the ePassporte Visa facility has been suspended, or for how long the suspension will last, but it effectively leaves customers unable to spend money online, or via ATMs/shops using the Visa-branded service.

Unconfirmed reports suggest that the suspension is due to security concerns, including card transactions that breach the Visa member bank processing rules, which Infosecurity notes prohibit gambling and money laundering where local country rules apply.

ePassporte is a member of Visa via St. Kitts Nevis Anguilla Bank and it seems that Visa has suspended the company’s services via the bank with effect from late on Thursday evening UK time.

Reporting on the saga, security reporter Brian Krebs – of the Krebs on Security newswire – says that the news caught his attention because he “recently encountered ePassporte accounts tied to several shady affiliate programmes, such as those used to reward people who promote rogue anti-virus products and online pharmacy sites.”

Krebs quotes the administrator of the online forum italkcash.com as suggesting that the move by Visa is in response to new anti-money laundering requirements mandated by the Credit Card Act of 2009, which affects prepaid cards and other payment card instruments that can be reloaded with funds at places other than financial institutions.

“Whilst the founder of the ePassporte service cannot be happy about these developments, the situation may provide a nice bump for his new movie: Mallick helped produce the Paramount film Middle Men, a movie released Aug. 6, 2010 that is based on his personal experiences in the porn website billing industry”, he said.

The synopsis, he adds, from the film’s Wikipedia entry seems oddly prescient:

‘In 1995, straight-and-narrow businessman Jack Harris (Luke Wilson) who builds the first online billing company dealing exclusively with adult entertainment, finds himself in the middle of a whirlwind filled with starlets, con men, Russian mobsters, federal agents, and international terrorists. Caught between a porn star and the FBI, Harris learns that even becoming one of the wealthiest entrepreneurs of his generation may not be enough to keep him out of trouble.’

Whilst the effects of the ePassporte service suspension has clearly left tens of thousands of cardholders cash effective locked down, it also begs the question whether the same thing could happen to other Visa-branded prepaid card services.

Technically, Infosecurity notes, this could happen to any Visa-issuing member financial institution, but Visa would normally be expected to give notice of such a move.

Given the large number of international prepaid debit cards – branded by Visa and MasterCard – it remains to be seen whether this is the start of a purge of prepaid card services that the card groups are less than happy with.