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Mastercard and Visa block payments to Swedish VPN firms

Better haul out those Bitcoins, folks

Internet Security Threat Report 2014

Mastercard and Visa have reportedly put a block on payment processing services for some anonymisation and virtual private network (VPN) services.

However, the move appears to be restricted to payments made to five consumer-focused VPN and anonymisation services though a single payment processor in Sweden, rather than a more wide-ranging crackdown against the widely used technology. The Pirate Bay's Peter Sunde's iPredator is among the VPN providers who say they've been informed they can't be paid by Visa-toting users.

VPN firms who take their fees using the popular Swedish online payment services provider Payson have reported receiving an email stating that anonymisation services can no longer be funded using either Mastercard or Visa card payments.

"Payson has restrictions against anonymization (including VPN services). As a result Payson can unfortunately no longer give your customers the option to finance payments via their cards (VISA or MasterCard)," the email reportedly stated, adding that direct bank transfers might still be used to place deposits in accounts.

Among the affected services is iPredator VPN, launched by Pirate Bay co-founder Peter Sunde. iPredator criticised the move but said it was still able to accept payments via either BitCoins or PaysafeCards.

"We are sorry to inform you that PaySon is not able to process any credit cards anymore from you," iPredator said in a blog post on Wednesday.

"They changed their policies after being bullied by Visa and Mastercard to exclude VPN services. We did not really receive a heads-up to that change so you have to go for a wallet provider at the moment while we are looking into alternatives."

Sunde compared the payment-processing block to Mastercard and Visa's decision not to process payments made to WikiLeaks back in 2010, in the wake of the controversial release of US diplomatic cables by the whistle-blowing site.

"Just talked to Payson who told me that the reason to close down payments for VPNs was an urgent requirement from Visa & MasterCard," said Sunde in a Twitter update before adding: "The credit card companies are obviously in a cartel. Both Visa & MC demanding the same thing the same day. Same happened with ‪@wikileaks‬."

VPN providers Anonine, Mullvad, VPNTunnel and Privatvpn rely on Payson’s services, Torrentfreak reports. All four of these services, as well as iPredator, are consumer-focused and based in Sweden.

VPN services establish secure tunnels to access content or services across the internet. As well as providing privacy in insecure locations, such as Wi-Fi hotspots, the technology can also be used to access otherwise blocked or location-restricted websites. Access is encrypted so the technology provides protection against snooping and credential snaffling.

Virtual private networks have been a mainstream security technology for years and are commonly used in business to access intranet resources or corporate emails. In enterprises, access can be delivered through SSL VPN appliances or through software clients loaded onto desktops or smartphones. All this is quite fiddly for mainstream consumers, hence the growth in VPN services aimed at consumers, some of which also offer anonymity.

Payson's Ts&Cs say it does permit payments to anonymisation services and VPNs - with restrictions depending on "current regulatory requirements". ®

Internet Security Threat Report 2014

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