I was wondering if anyone has ever come across the same merchant using multiple Third Party Payment Processors?

I was reviewing a list of underlying merchants and have found an instance where the same merchant is using two of the TPPP's that bank with us. The TPPP's are not related.
Does anyone know if there is any guidance on this topic?
Thank you,

Is there some law against a business using multiple payment processors??? What type of payments are you talking about?

Guidance on TPPP's sites a potential red flag if the TPPP itself uses more than one financial institution for its payment processing (FIN 2012-A010), I didn't know if anyone had guidance for a merchant using more than one TPPP.

" Accounts at Multiple Financial Institutions: Payment processes engaged in suspicious activity often maintain accounts at more than one financial institution. Similarly, they may move from one financial institution to another within a short period. Such payment processors also may use multiple financial institutions and maintain redundant banking relationships in recognition of the risk to the payment processor and merchant that financial institution may recognize the suspicious activity and terminate the payment processor and/ or merchant accounts." FIN 2012-A010

That is talking about TPPPs themselves - it is not related to a merchant that uses multiple providers. Like I asked, what type of payments are you talking about. Maybe one of the processors only handle a certain type, thus they need to use multiple service providers.

I have seen merchants acquire other merchants, resulting in TPPPs that are in place remaining, for ease of processing and conversion. what you need to be concerned about is being able to aggregate and track rejects across multiple TPPPs to ensure you are monitoring properly.

Thank you Happy Gilmore that makes sense. I'm in the midst of an audit of TPPP's and it is proving to be quite..... interesting.

Few more questions regarding TPPP's:
1) Does your institution allow customers, including TPPP's to transact without being fully on boarded (meaning complete CIP/KYC and approval)? If so, how long do you allow them to transact before gathering all the required data?
2) If you bank TPPP's do you have a separate case management system for tracking purposes for onboarding and periodic review?
3) Regulatory guidance requests screening for litigation, however our negative media screening is for AML, terrorist financing and anti bribery and corruption only...I feel we may be missing additional litigation for the TPPP and its owners and underlying merchants regarding any additional litigation. What do you specifically screen for?

Thanks everyone for your help.

1. Never
2. Always
3. The word "litigation" is not included in the TPPP exam procedures. But if the TPPP is involved in litigation, I think you would want to know about it. The first thing you do is ask them.

Thank you!

Yes the litigation search is not from the FFIEC Exam Manual, it is in guidance provided by the FDIC "Managing Risks in Third-Party Payment Processor Relationships (Revised July 2014)"

"Obtaining information pertaining to any litigation and actions brought by federal, state, or local regulatory or enforcement agencies."

Your institution would not screen separately for any litigation?