PEP Episode 007 — The Payment Angel of International Processing – Meet PSP Angels!

Podcast Description:
In this episode Jarvis Lagman, Senior Associate Attorney, talks with international payments expert, Viktoria Soltesz, President of PSP Angels.  Viktoria and her team are independent payment consultant experts who can help you navigate the payments space overseas, in Europe, Asia, and beyond. If you’ve ever considered taking your business offshore, or expanding into international markets, you will not want to miss this episode.

Jeremy Stock (00:00:00):

Welcome to the Payments Experts Podcast, a podcast of global legal law firm ISOs, FinTech, pay fax agents, merchants, processors, acquiring banks and card brands. If these terms mean something to you, this podcast is for you. If these terms aren’t so familiar, this podcast is even more for you. We hope you enjoy this episode of pep, the Payments Experts podcast. Welcome to this episode of the Payments Experts podcast. Really excited. Today we’re gonna be discussing International Payments Law Rising. We’re very fortunate to have in studio with us, uh, Senior Associate Attorney, Jarvis Lagman, um, as well as, and I hope I don’t butcher your name Victoria <laugh>. Viktoria Soltesz?

Viktoria Soltesz (00:01:02):

That’s right. <laugh>. Is that

Jeremy Stock (00:01:03):

Correct? Uh, Victoria is with PSP Angels Payment Service Providers Angels. Uh, Victoria, why don’t you tell us a little bit about yourself and, uh, what you guys do?

Viktoria Soltesz (00:01:14):

Sure thing. Thank you very much for having me on this amazing podcast. And, um, I would like to say that, uh, and I’m very honored to, to be able to speak about my profession. Um, my name is Victoria Schulte, and, uh, I’m the founder of PSP Angels. I actually started off my, uh, career as an accountant, uh, tech advisor back in the days I was living in Cypress. And, uh, we set up different, uh, tax structures. Um, we helped, uh, companies, uh, to set up, uh, different, um, um, onshore and offshore structures, uh, tax optimization, obviously opening bank accounts for them. So this is my background. And, um, I gained quite a lot of companies. I advised to them, um, how to move funds, obviously, internationally. And that’s when the big question came when compliance started to be a burden that I understood Victoria, that yes, the tax can be optimized, but how are we making sure that the banks are also happy with what we are doing?

Viktoria Soltesz (00:02:15):

And there was more and more problems, uh, getting accepted. Mainly when, uh, we are talking about online companies or offshore setups. The bank started to be a bit iffy with these kind of setups. And, um, I found myself more and more dealing with the banking side of the business and moving funds and, and the clarifying transactions for the banks other than optimizing tax. So that was the whole idea when, um, I started to see that there could be a good opportunity on the market to explain how banks think, uh, just justify why you cannot do certain, uh, transactions. What if high risk when it comes to online payments, obviously, uh, because I noticed that back at the day, mainly when the compliance started, it was a whole blur. Nobody really knew anything. The, the prices were completely subjective. I know you, I take you, I don’t know you, I don’t trust my license because of you.

Viktoria Soltesz (00:03:07):

So it was a bit of a mess. And, uh, when we started P s P Angels, um, I remember we started off in an exta sheet with, uh, you know, the vertical. We had the clients, and then the horizontals, the different banks and the payment service providers. And wherever the Excel sheet hit each other on the south, we saw that that bank is rejecting, that client is accepted. What are the fees and whatnot that, that, that happened actually six years ago. And now we, uh, developed to an international company. Uh, we have more than 2,500 clients. Uh, we are not only doing the matchmaking, uh, with finding merchant accounts and bank accounts for these, uh, online businesses, but also setting up the different structures internationally from the payment perspective. So, of course, I’m still using my financial, uh, background to, to help them on the taxation, but also, uh, mainly focusing on where the money comes from, how much, how often, what currency, you know, explaining to them, uh, why it’s not a good idea to keep millions and millions of one bank account.

Viktoria Soltesz (00:04:10):

You know, how is it gonna affect you if they go bankrupt? Mm-hmm. <affirmative>, um, and overall, uh, just makes sense of this whole online, uh, payment, uh, blur, as I said. So, um, right now we started also consulting to financial institutions, um, brokers, um, emo institutions, banks, how to optimize, uh, their, uh, correspondent, uh, connections, international, uh, bank transfers, and also, uh, how to optimize their, um, portfolio when it comes to high risk versus, uh, low risk. How high risk is high risk, what is the actual risk, which is posing on, on, on the operation. So yes, you’ve got a lot of things to do. You have a lot to talk about. Um, everything is yes, and everything is, you know, always changing all the time.

Jeremy Stock (00:04:57):


Viktoria Soltesz (00:04:58):

But I’m, it’s a creative work, let’s say, and, uh, it’s good to, good to see what works and what doesn’t. <laugh>

Jeremy Stock (00:05:04):

Really quick, cause I know Jarvis has a lot of questions, and I’m not going to to jump on top of that, but I do wanna tell a quick story, which I think is telling. And this happened just the other day, literally a couple days ago. So we had a potential client contact our firm mm-hmm. <affirmative>, and he was a Hong Kong based business. He wanted, he was interested in advisement on English and Wales law related to payments, which is why he reached out to us. Mm-hmm. <affirmative>, well, I connected him with Victoria. Yeah. It turns out he emailed back five, 10 minutes later. He says, I already work and know Victoria <laugh>. How great is that? Yeah. Uh, so Victoria, you, you are not exaggerating. Um, it won. Payments is a small world in some ways, and also shows, uh, you know, how well your business is doing. And, um, that was really a cool, uh, instance, uh, that happened.

Viktoria Soltesz (00:05:55):

That’s right. You know, it’s a small business. Everybody knows everyone. And when we are talking about mainly high risk payment service providers, we see the same faces coming back to us on the different business names as well. So it’s also adding a bit of, uh, you know, spice to the whole industry. But, uh, as I said, it’s, uh, it’s, it’s, it’s very exciting. There are a lot of innovations, a lot of new ideas, a lot of new technologies. So yeah, that’s definitely keeping us busy, <laugh>.

Jarvis Lagman (00:06:21):

So, so how does the, um, European Union regulations impact the underwriting of these merchant accounts? And, and essentially how all the different, um, actors in the industry, like, what was the difference between pro-regulation and post regulation? Did, did the regulations actually change or help, or, or, or, or is it just an additional compliance feature?

Viktoria Soltesz (00:06:47):

I think, uh, to reply to this question, we need to go back and, uh, understand why the regulation is getting harder and harder. And as I can see, it’s not only in Europe, but everywhere in the world. Mm-hmm. <affirmative>. So if you think about it, when you’re a country, your biggest motivation is to keep people, uh, paying taxes, obviously, to, uh, maintain a healthy society. So if you see that there is, um, an opportunity for tax evasion or, or bringing your business, mainly when we are talking about online businesses, which are more and more popular nowadays, taking it offshore or taking out of the jurisdiction where the person should actually pay taxes. Mm-hmm. <affirmative>, you should stop it. Now, obviously, countries cannot go to different countries and say that, Hey, country B, I am country A and I don’t like how you are taxing, uh, let’s do something else.

Viktoria Soltesz (00:07:36):

Mm-hmm. <affirmative>. So the only only weapon, let’s say a control tool in their hand is to regulate the banking connections. And that’s what we see, um, when we are going deep down, um, uh, in the banking sanctions. So there are certain countries which are sanctioned, so you are no longer playing with us kind of attitude. The lighter version is the anti money laundering. Mm-hmm. <affirmative>, the, the anti-tax avoidance rules and all those kind of know your customer, know your business kind of checks, which are intended to limit those kind of, let’s say wrongdoings. Yeah. It’s not necessarily illegal to take your money offshore and run an offshore company, but good luck finding a bank account for that. So, as a rule of thumb, um, European Union introduced, um, a kind of common understanding that if you are a person who is sitting in, let’s say Germany, you are breathing German air, you are serving German customers, or even if your business is online, but you are actually using the German, um, uh, infrastructure and housing and whatnot, benefits, you should actually pay German taxes.

Viktoria Soltesz (00:08:46):

Mm-hmm. <affirmative>. So you cannot, uh, run a company, let’s say in Cyprus where the taxation is better. So that means that you have to pay taxes where you sit because the management and control of your company is at that given jurisdiction at that given country. So that means that if you are within the European Union, you can only, uh, uh, run your company basically within the European Union, otherwise, you will never be able to find the bank. Even if you find an a bank outside of the eu, good luck bringing the money back to the European Union, uh, through the, you know, uh, justifying the source of funds and whatnot. So if you have, uh, European regulated payment institution or European regulated bank, as a rule of thumb, they can only take an EU company, European Union Company with an EU director with an eu, uh, traffic serving European clients. And of course, if the company needs a license, it has to be an EU license as well. So many times we see, for example, uh, a Hong Kong company is trying to apply for, um, a merchant account with a European regulated acquiring bank. They will not succeed because the European regulator says, EU company, EU director, EU traffic. If you don’t, uh, fulfill those, unfortunately, we are not allowed to give you a merchant account.

Jarvis Lagman (00:10:11):

So what, what’s the, uh, the drawbacks for that? Because I feel like on the one hand, you know, there, you know, in, in, in America, the, I guess the idea that you expressed would be something known as minimum contacts, right? So to the extent that a company has minimum contacts to the jurisdiction in the United States, it’ll be subject to United States law. So it sounds like it’s a very parallel, um, I, I guess le legal doctrine that governs how, um, how your European countries or EU countries, um, I guess a certain jurisdiction over these companies in a, in a way to, you know, ensure that would be to require, you know, a stronger contact to the jurisdiction, right. That you know, that, you know, they need to be eu, uh, citizen and, and have stronger EU ties. So a foreign company could use EU infrastructure, use EU banks to be able to do these kinds of transactions.

Jarvis Lagman (00:11:06):

I, I mean, well, what, what’s, what’s the negative in terms of that approach, right? Because you’d think that you’d want some of the capital from these places to migrate into the eu to, to enrich the enrich to the Eurozone, right? So, you know, you’re kind of foreclosing capital kind of coming into the country, which could be used That’s right. To help develop commerce and build up soci, have a healthy society. So as much as anti mundy laundering and fraud and, you know, and, and making sure that, um, all these transactions are above board. Although that’s one very important virtue. Another important virtue is just to get the money into the country, then see, see what we’re gonna do with that, and make sure that once the money’s here, now we can actually regulate it, as opposed to putting up a wall and saying, the money can’t even come in.

Viktoria Soltesz (00:11:52):

Exactly. And, uh, actually, what, uh, what you’re referring to, we call it substance mm-hmm. <affirmative>. So the substance, uh, is when you are running your company from a surfing jurisdiction, now it’s getting harder and harder because nowadays there are digital nomads. Everybody’s traveling everywhere. Mm-hmm. <affirmative>, I’m working two months in Bali, I’m working two months in Germany. The rest of the time I’m spending in whatever have I, uh, the rule of thumb usually is where are you a tax resident? That means that that’s where you live, therefore that’s where you are running your business from. And I have to highlight that we are talking about online businesses mm-hmm. <affirmative>, because if you have a brick and mortar business, where is your office? Where are your employees? Where are you selling your products? With services? With online businesses, it’s always a bit, Hmm. Because mainly when you are international, your clients are international, it’s very hard to pinpoint where is actually the tax jurisdiction of that, uh, business.

Viktoria Soltesz (00:12:50):

Mm-hmm. <affirmative>. So what we say usually is that where you have your substance, many times they’re asking for a utility bill, because that means that if you are paying water or if you’re paying electricity, that means that you are using a property. And that’s why your, uh, tax jurisdiction is there. The management and control is exercised from that very jurisdiction. Therefore, that’s why you have to pay your taxes there. Now, obviously, people try to be clever, no one likes to pay taxes, or they tell them they have to. So we have millions of times we requests when people start to out clever the system, and they say that, Hmm, I figure it all out. I’m setting up an offshore company. I’m doing online business. I’m, I’m providing consulting services. I set up a business in Panama. I set up a business in, um, uh, British Virgin Islands or any other, uh, jurisdiction where the, the tax obviously is, uh, is zero, and there are no bookkeeping requirements.

Viktoria Soltesz (00:13:47):

Mm-hmm. <affirmative>. So everything is easy. Uh, the problem starts when these people want to actually get a bank account or a merchant account with, uh, with a well-known, uh, well-established bank who should not support this kind of system. Mm-hmm. <affirmative>. And what I’m asking them that, Hey, why did you set up a, a, a company in Panama? The answer, because I’m paying less tax, obviously it’s not a good answer. So you should not actually justify and say that that is the reason why you set up that company in a, in a certain jurisdiction. Many times we see this, um, in a smaller scale in Europe because there are different taxation, uh, between European countries. So the tax in Germany is higher than the tax, let’s say in Cypress or in Malta. Mm-hmm. <affirmative>, uh, needless to say that countries want to, um, um, increase the foreign, um, investment in a country, mainly when the country doesn’t have anything else to offer.

Viktoria Soltesz (00:14:44):

Mm-hmm. <affirmative>. So when we are talking about small, uh, countries, small islands like Cyprus or Malta, they don’t necessarily have a very strong, uh, uh, infrastructure for agriculture or, or any kind of like, uh, industry. Um, but they are very good with financial services mm-hmm. <affirmative>, so that’s what, that’s what they want to improve. So they give a lot of tax incentives and, and, uh, government support for foreign investors. Now, it’s all good until you are actually moving to the country and whatever you are earning your spending within the country, and that justifies why you’re paying less taxes, because you give back to the society. The problem starts when you are just taking advantage of the jurisdiction without actually being there. Mm-hmm. <affirmative>. So when you are sitting in Germany, as I said in a previous example, if you’re sitting in Germany and you’re using German roads and, uh, you are going to a German shop to, to, to buy your food, why are you taking the tax money out?

Viktoria Soltesz (00:15:41):

And why are you paying the taxes in Cyprus or in Malka, even though that you’re still within European jurisdiction? That could be questionable. And now sim banks and financial institutions having even sometimes mind-bending questions like, why is your phone number? Because in Europe, every phone number is different based on which country that that, uh, uh, mobile provider is issuing the, you know, the SIM card from. Why is your mobile number is in, uh, I don’t know, in Lithuania, when your business is, uh, uh, is in Italy. And even though that you say that, Hey, in Europe we don’t have borders, I can actually sit in my car and drive around and I can use any kind of mobile provider because there are no roaming expenses. They still need to pinpoint the jurisdiction of your company and exercise all those rules and regulations for your company, including taxes, which are relevant to that, uh, jurisdiction.

Viktoria Soltesz (00:16:38):

And it’s the banks and financial institutions, uh, responsibility. Obviously, government cannot be anywhere. So that’s why they give financial licenses to these companies, that they are shifting the responsibility that you check it, you are responsible if everything is going well, because you are the one who are handling the funds. And of course, these financial institutions have no other, uh, opportunity. Then check all the transactions, incoming, outgoing, K Y C checks, know your customer, K y d checks, know your business, keeping, uh, records on the, on the files onboarding. So it’s a lot of, um, administration burden, which obviously increases the fees as well for banking fees, which ends up on the client. But, uh, but yeah, it’s a, it’s a, it’s a different subject. Mm-hmm. <affirmative>, basically, the banks are responsible to make sure that, uh, no tax avoidance, obviously no money laundering is, is happening within, within their, uh, their business, their operation.

Jarvis Lagman (00:17:35):

So, so a lot of what, um, I, I guess a lot of these regulations are focused on essentially card not present transactions, transactions, they’re online where there isn’t a brick and mortar, or there isn’t a place where you can actually demonstrably point to why you have jurisdiction other than the, the affiliated or the principal’s residents. Is is that, is, is that kind of what you’re getting at in terms of how the regulatory burden has kind of shifted in focus?

Viktoria Soltesz (00:18:09):

Exactly. And it’s, it’s, it’s very, um, complicated because when you are selling something online, mainly when we are talking about services, it’s very hard to justify that actual, the sale to place mm-hmm. <affirmative>. So, for example, there is an Instagram influencer and you are, you know, sending, sending donation to the person. Uh, the bank only sees incoming transactions in small amounts from individuals as high risk as it gets. So of course, when the bank wants to justify, where are you getting all these payments? Well, people like me and they send me money, and now I became a millionaire. The bank’s responsibility to make sure that all those funds which are hitting the account of that Instagram influencer is not only coming from logic sources are taxed, and, you know, it shows on the individuals tax returns. So the source of funds is, is declared because if even one transaction is going through, which could come from a sanctioned country or, or any other ways of like a non-text income, it is going to be the responsibility and of course, the penalty for the financial institution to allow that transaction.

Viktoria Soltesz (00:19:22):

Mm-hmm. <affirmative>, so it doesn’t get any more high risk than it gets, or for example, there was another example. Um, I have a good friend, uh, in, in Cypress. Um, he’s over, uh, 60 years old and, uh, all his life he was dealing with, uh, with shipping activities, so low risk, uh, shipping, uh, banking and, and shipping insurance. And, uh, he called me one day and he told me that, Hey, Victoria, I know that you’re, uh, very active in blockchain and you know, what’s bitcoin? Imagine I did the same. I actually went to the crypto chain. I bought $500 worth of Bitcoin, and I did it well, and a couple of weeks later, I cash out 550. So I made 5,000 profit on it. Now, the problem started when he actually carried out in fiat traditional money on his bank account, this $550. So the bank obviously put him on a hire that Wow, wow, wow.

Viktoria Soltesz (00:20:19):

This individual has crypto related transaction. We cannot filter out if this crypto has been taxed. Is it covering the alleged, uh, Euro activity? Is it coming from alleged sources? It’s not custom kind drug money mm-hmm. <affirmative>, and unfortunately, they put my friends on a very high risk, uh, category, which increase his mortgage, his business loan, not only his personal finances cost, uh, just went up to the roof. The whole company, when he was a business owner and the director and the whole shipping company for a couple of years, was on actually a higher risk category for the, for the eyes of the bank, regardless of the 2030 year connection simply for Transac transaction.

Jarvis Lagman (00:21:07):

Or not even for 50 bucks.

Viktoria Soltesz (00:21:08):

Exactly. Yeah. The, the 50 bucks, uh, difference. So banks are having a very hard time to filter out these transactions. All the responsibility is with them. If they don’t comply, they get the penalties. Of course, they’re anal about everything. Yeah. But on a personal level, when you’re trying to run your business, it, it, it, it, it might not be understandable that, that how comes that I cannot control my own money. I cannot spend my, spend my own money however I want, and why do I have to report back everything to the bank? So it’s a very parallel situation at the moment. Let’s see what the future

Jarvis Lagman (00:21:46):

Holds. But so do you, so in your opinion, would you say that European, uh, financial institutions are more risk averse than their American counterparts? Because I, I don’t know if you’ve been following the news right? With, uh, like Silicon Valley Bank, where, you know, the bank itself was engaging in crypto transactions. Right?

Viktoria Soltesz (00:22:06):

Exactly. What I, what I know is that the regulator is definitely stricter and, uh, the penalties, uh, can come easier. Therefore, I would say that yes, there are certain banks who are more risk averse, but if you think about it, how high risk is high risk to a bank or a financial institution. So if you have a bank, right, you are having a lot of low risk customers, domestic clients, supermarkets, shoe shops, everything is vanilla. Life is good. Mm-hmm. <affirmative>. So the person, obviously you, you’re running a financial institution, you are not a charity. You need to create some profit, right? So the, the shareholders are coming to the bank and they say that, guys, we need to make some profit. How are you gonna make some profit? It’s such a, such, um, um, uh, uh, supply oriented market that you cannot really increase your fees because all your customers are just going to the competition.

Viktoria Soltesz (00:22:58):

Mm-hmm. <affirmative>. So what are you gonna do? You talk to your risk guy and you ask the risk guy that, Hey, how can we earn more money? Well, we need to take more risk, more monies, obviously mm-hmm. <affirmative>, you know, coming with more risk. So what can we do? Well, I think we can start onboarding a bit more risky customers. Okay. What do you think about introduce gambling, introduce license operations, bonds, asset management, uh, introduce maybe adult entertainment, which is actually the product is not high risk, but the reputational damage could be mm-hmm. <affirmative>, but, you know, oh,

Jarvis Lagman (00:23:30):

And plus the regulations concerning the operation of the business and generate risk. Right. You know, if they’re underage, you know, that kind of thing.

Viktoria Soltesz (00:23:38):

Exactly. Or introduce, for example, crypto. So what do we need to do for that? Well, we need to get a person who is, uh, understanding the whole market in the compliance department. So if I, I trust my compliance and my compliance have experience with these kind of verticals, we are looking like we are taking the risk. We can increase the financial product prices for those kind of verticals, and we are gonna make money. So this is what we see many, many times. And we don’t even like us, like normal human walking on the street. We don’t even understand how banks think, but this could be the reason why one day the bank is accepting your business the other day is rejecting you. One day they say that, um, okay, we are making a lot of money, and another day they are, they are losing money.

Viktoria Soltesz (00:24:27):

So there are a lot of decisions happening at the background, not even mentioning the connections between international bank accounts. So for example, Silicon Valley Bank was the correspondent and the account of one European bank. How do I know, what do I carry the customer? I don’t know. What are the transactions of my bank? What are the internal decisions of my bank? However, it does affect my funds, it does affect how my bank is, is actually safekeeping my funds and, and even investing my money in, in, in certain financial products, which then, you know, can go down. So it’s a very complicated subject. Um, yes, they, the, the, the banking is, is, is like a spider net. Everything is related to everywhere. So even if you just, um, um, have a little disturbance on one end, it can actually spread and affect everyone globally. Like what we see, for example, in 2008, when the, when the banking crisis just took over the whole world mm-hmm. <affirmative>. And, and that’s why it’s very hard to, um, to predict that, um, how your banking connections will be in the future. Even if you don’t consider yourself a risky business, maybe the bank will. So if you’re a startup, for example, you can end up in a high risk category, my friend can be, uh, high risk because of the one crypto transaction. And, and, and, and you just don’t know sometimes how the bank is gonna react to your, to your business, to your independent. Uh, so

Jarvis Lagman (00:25:55):

So would you say that each bank’s underwriting policies are both a unique to the bank and B not very transparent?

Viktoria Soltesz (00:26:05):

Well, it’s definitely not transparent to the open public. Yeah. What the bank is, is, is, is doing internally. Okay. Maybe if you’re doing massive research and, and you are getting into documents, but usually it’s not even a public information that what drove a risk decision? What drove the decision to accept or reject a client. Now I’m going even further. The bank does not even have to give a reason why they are rejecting you or why they are closing, uh, an account on you. Many times we see absolutely personal decision, Ooh, I don’t like him. Or adverse media. What is adverse media? Why I’ve, I’ve, I’ve got, got one person who doesn’t like me write a bad article about me. I’m adverse media. Yeah. So, so there is a lot of subjective element in this question, which is very, um, hard to approach. And for us, like normal people who are having money in the bank, of course we don’t know how that bank is handling our money, right? Why would we, why do we even care? And that’s why we put our trust in the license. Yeah.

Jarvis Lagman (00:27:08):

But yeah. But would you say that, you know, for all of the increased amount of regulatory activity govern governing the banking system, that maybe the regulation should also focus on creating transparency and, and, and underwriting, right? That there should be some kind of standardization in terms of how banks arrive at an underwriting decision. Because I, I feel like what ends up happening, at least in the United States, right, is that, you know, some of these underwriting decisions get decided by leverage, right? It’s like, you know, you go to the bank and say, well, you know, if, if you want us to put $5 million in your bank, you know, maybe you do what we tell you to do, <laugh>, you know that that happens here, right? Because at the end of the day, right, you know, the, when the bank does the cost benefit analysis, yes, they may be taking on risk, but you know, there’s more money in the reserve account of the bank if, if you do the deal, right? So, so I think there are ways to generate leverage that are even outside of, uh, even like a, a, a bank’s underwriting decision that they would make in a vacuum. Uh, right. Because, you know, cuz going back to your, your, uh, e central point, right? It also seems that banks can treat different customers differently based on how appealing that customer is to them. And that feels fundamentally unfair.

Viktoria Soltesz (00:28:26):

Yeah. Very subjective as well. And uh, as I said, many times it happens at the compliance officer who is working at that department, has an experience with that vertical or not. I know for a fact that there was a financial institution who had no clue about crypto what the management decided. Guys, we are opening up for crypto. What do we need? A couple of people who understand what is blockchain? How is crypto transactions working? And can filter throughout the scams, at least on a basic level. They introduced a couple of new compliance officers in the compliance department. They took on some crypto clients, obviously charging them a lot, right? This is, this is much as that move. And they become crypto friendly bank and they were very, very successful. So it is a lot of personal, um, uh, touch on, on on that side as well. And there is a lot of, lot of, uh, subjective decision, which even though that you’re making it transparent for us as, as everyday people, it might not really mean a lot. Because even if I think that okay, my money is is in the bank and there is not even a 10% reserve, which is covering my fund at the moment, I’m still investing that money. I’m keeping it with a financial institution, even though that it goes against every kind of like, logical decision. Right? <laugh>, why would I do that?

Jarvis Lagman (00:29:48):

Cause I think I’m someone who trust institutions, right? There’s an inherent. Exactly. You know, because at the end of the day, you know, as a individual consumer, as individual person, you know, you have your lane that you need to focus on. You, you have to trust that everybody else is doing their job and the way you expect them to, um mm-hmm. <affirmative> and, and to the extent that those expectations depart from the reality, I think that’s where a lot of this friction comes from.

Viktoria Soltesz (00:30:14):

That’s right. Um, maybe,

Jarvis Lagman (00:30:15):

Well, I guess maybe a follow up question. Cause I, I feel like, um, over the course of my practice here in the United States doing a lot of the payments processing work, and I definitely appreciate you, uh, giving us an understanding of how the banking relationships work. So, um, so we work a lot here with Visa, MasterCard, I, I I believe there’s another, uh, payment card company that’s very prevalent Europe, uh, for life pay. I can’t remember what it is, but I mean, so, so what impact do those companies have on how, how everybody organizes their transactions from merchants up to the financial institution?

Viktoria Soltesz (00:30:51):

Well, they are the ones who are actually making a decision. I don’t know if you remember a couple of years ago that was a, a hiccup in PornHub and, uh, visa and MasterCard wew their support to PornHub. And that’s what we really, so a spike in, in crypto prices going up because they use it as alternative payment. But what I’m trying to say is that, um, uh, visa, MasterCard is so big that they can write their own rules. And that’s why we are talking about Visa, MasterCard, uh, uh, schemes and regulations. And obviously you have to play by their rule if you want to get a piece of the pipe. So if you are not fitting into their merchant code, they simply don’t deal with you. And when we are talking about high risk clients, there are so many skill in percentage that sometimes it doesn’t even work for, uh, visa, MasterCard to even consider them.

Viktoria Soltesz (00:31:41):

Therefore, the bank is rather rejecting them than taking the risk, uh, on. But in the same time, what we see to balance out the, um, the mono situation of these giants, there are a lot of alternative payment methods, mainly on the emerging markets in Africa, for example, we see, um, uh, a mobile payment method when you are not, uh, uh, you don’t have an, uh, uh, opportunity to access the banking system. What you do, you go to the village, you top up your mobile phone, you’ve got some minutes, and this is basically the volume, what you’re exchanging with your mates. So you are going to the local pub or a, or a bar, how much is this bigger? It’s two minutes. So they are, the many times they are using it as a form of payment mm-hmm. <affirmative>, uh, because it’s free, because it’s cheap, because it’s immediate to transfer.

Viktoria Soltesz (00:32:34):

But we can go, for example, uh, to Southeast Asia. They are very, very popular in their own payment methods. Indonesia, uh, is very popular for the QR codes. Everybody’s paying with that. Or when you’re going to, um, uh, to Japan, uh, you’ve got certain different, um, uh, payment methods, wallets, uh, uh, Dino Pay for example, or Philippines, you’ve gone the Dragon Pay, every jurisdiction has their own, um, use tested and preferred payment method. Mm-hmm. <affirmative>. Now our job comes in when a client would like to go international, and they say that, okay, I nailed Visa, MasterCard, let’s go to South America, and I would like to offer my services or products there. And they think that with Visa and MasterCard, they can enter the, the Venezuela market mm-hmm. <affirmative>. Now, clearly we know what happened in Venezuela. People don’t have, not even just cards, but the whole Venezuelan financial system is in shambles.

Viktoria Soltesz (00:33:29):

Mm-hmm. <affirmative>. So if you would like to target areas, um, uh, with, uh, with Visa, MasterCard, when people just don’t have access to Visa and MasterCard, that’s when you are using alternative payment methods. Now, this should be the, the, the reason why alternative payments come across. But nowadays what we see is that, uh, merchants and online, um, companies are using alternative payment methods many time to actually spare some money, uh, on Visa, MasterCard fees, because we know that interchange can be very pricey. So if you are using the whatever wallet, you get an extra discount. If you are sending me, uh, I don’t know, uh, the mobile payment, the, the minute I can, I can actually calculate that in my price. And many times we see that some, some companies are working with a very small profit margin, half a percent, 1%, which is Visa, MasterCard, interchange fee, even, even, even higher. One and a half percent can make a lot of difference for their profitability. And that’s why they are reaching out to alternative payment methods.

Jarvis Lagman (00:34:34):

So, um, I mean, and I understand that, and, and a lot of, you know, even just in my own free time, I’ve been thinking about what is the value of Visa MasterCard? What, what are they actually presenting other than marketing and, you know, and branding and things like that. We’ve had this conversation and service. Yeah. And one of the things I thought of was, a lot of it is creating protocols for handling disputes, right? Mm-hmm. <affirmative>. So, you know, my issue with, um, essentially the crypto transactions is, okay, you get instantaneous settlement. What happens in the ven of a chargeback or dispute, right? I think, you know, v under Visa, MasterCard, there is a process for being able to arbitrate that dispute, resolve it, and then funds get transferred or either credited or debited based on the resolution of that process. Whereas I, and I see, I see in a lot of these other alternative payment, um, systems where they don’t have, have as sophisticated of a, of a dispute resolution process. What is, what is the, um, the remedy for the users? You know, in the event that there’s a dispute over payments,

Viktoria Soltesz (00:35:38):

I feel that not that many people know about chargeback. Yeah. If we are considering the public, right? So if you’re going down the street and you’re knocking on someone’s shoulder and asking the person, Hey, do you know was the chargeback, chances are okay, maybe in the state it could be different, but even, well, I

Jarvis Lagman (00:35:55):

Think we’re very litigious here. I think maybe that’s the difference transaction

Jeremy Stock (00:35:59):

Or major issue in the United States.

Viktoria Soltesz (00:36:01):

Yeah. But if you’re, if you’re going to Indonesia, if you’re going to, I don’t know, in, in, in, in Hungary, people don’t really know about it. So I know my mother still doesn’t want to use her card online because she thinks that they gonna copy the code, they’re gonna empty her account and all over, if they don’t deliver what she paid for, the money is lost forever. So it’s the high that that’s the highest risk it ever gas. And then I have to explain to her that, no, there is a chargeback method, then it was absolutely a surprise for her. And if my mom’s generation doesn’t know about it, trust me, my generation, many times they don’t know about it. And we are not talking about us, we are talking about Europe, we are talking about emerging markets, Africa, Southeast Asia, uh, south America, they don’t even have a car, let alone there’s this kind of knowledge about this kind of systems mm-hmm. <affirmative>. So that’s where we see that the alternative payment methods are giving more benefit than, than actually downfall. And, and, and many times it’s just easier, it’s quicker for them. So Yeah. But they don’t I agree with you.

Jarvis Lagman (00:37:03):

Yeah. But they don’t have the, but Yeah. But I guess it’s more of a cultural thing where that’s right. You know, people honor the transaction, you know, at the point of payment. And they never really returned back to the transaction dispute. I didn’t get my goods back or I didn’t, you know, uh, because I, I think, you know, for whenever I’m like negotiating some of these merchant agreements, a lot of it comes out to who’s gonna be responsible for these, uh, you know, these, uh, merchant losses, right? Yeah. And, you know, and, and, and, and I feel like a lot of, even the American financial system kind of builds in a little bit for fraud and losses related to, related to fraud <laugh>, right? So, yeah. Yeah. Um, and, and I think it’s a different approach than the European Union, cuz I think the European Union in its, um, I guess the ideal would be zero fraud, right? Like, okay, we’re just gonna make rules and, and we’re gonna structure transactions in a way where people are not gonna be able to commit fraud because everybody’s gonna have some kind of tie to the jurisdiction. And if you commit fraud, we’re gonna hunt you down cuz we know where you live and we can get you, you know, just correct me if I’m wrong, should be

Viktoria Soltesz (00:38:10):


Jarvis Lagman (00:38:10):

<laugh>. Whereas I think in America it’s a little bit more LA fair where it’s like, okay, we don’t know where you are, but we think that we’re gonna make so much money from having a LA fair approach to these transactions that at the end of the day, yes. Even though there’s gonna be losses associated with these high risk behaviors, right? We’re gonna make more money because of the volume of transaction will be so much greater. So I, I think that’s some difference in approach between these systems. Just more thematically. I don’t know if you’d agree with that

Viktoria Soltesz (00:38:41):

Completely. And the thing is that, uh, we don’t even have to go to Visa and MasterCard chargeback procedure. You just need to ask your friends, what was the last time that you actually study your bank statement? Do you know, what was that bank transaction on this, you know, paper two pages ago? Do you know that the chances are they, they will, they will not know that. So Oh, people

Jarvis Lagman (00:39:03):

Wouldn’t even know the about their recurring authorizations. I’m sure that they actually looked at their banks. Exactly. And it’s like, oh, I’m still paying for that. Exactly. I signed up for that. And then oh, they doubled the price on, you know, so even, even the idea that consumers aren’t aware of recurring authorizations and their ability to, with withdraw consent for those with authorizations, right? Yeah, of course. I I mean some of this is, I feel like a lot of these companies are making money off of people’s ignorance. Uh,

Viktoria Soltesz (00:39:29):

That’s right. That’s, that’s what the whole subscription modeling is made for <laugh>.

Jarvis Lagman (00:39:33):


Viktoria Soltesz (00:39:33):

If you think about it. Yeah. Uh, right. But, but, but that’s, that’s, that’s what we see here as well, that, uh, that people don’t know about it. Of course, you are always gonna get the friendly fraud. You’re always gonna get the smart people who try to outsmart the system and charge back things. Uh, but it’s, it’s not the ma the majority. So if you’re thinking about it, if you’re selling on the large scale, sometimes it’s just easier to, you know, just just say to the charge back. Yeah. Just give it back to them. Like for example, how Amazon does it. Ooh, you don’t like the color, fine, don’t even send it back just $10. Who cares? Because it’s cheaper. Easier than I start an investigation file for every single chargeback and try to fight it back. And, and in this way, yes, I agree with you. Visa, MasterCard is amazing because it gives you kind of security how many people are actually using it. It’s the same as travel insurance. How many people are actually paying for it? Muhammad is actually using it. So there are the ideological aspect of payments. There is a practical one. So yeah, of course if you are, uh, you know, you need to consider both <laugh>. Oh,

Jarvis Lagman (00:40:39):

No. And I think so, so much of what’s interesting about, uh, even speaking with you about learning more about not even just the European payment system, but also the European payments culture, is that I feel like the culture actually informs how the payments are structured, right. Because it isn’t very litigious, because it’s also very like, detail oriented associated with, if it’s de at the very, the very beginning of the podcast, you talked about how, you know, the point of taxes is to enrich the society that you live in. That’s not a very American <laugh> Yeah. Thinking about tax. I haven’t heard that in a while. Yeah. Yeah. I mean, and I agree with you, right? That you know, and, and, and I think because you, you live and operate so internationally, especially being in the EU where, you know mm-hmm. <affirmative>, if you think about the United States, imagine if the United States was a decentralized federalized, uh, society like Europe, where people in California speak a different language than people in Arizona. Even though we have open borders, we have different cultures. Yeah. 50 countries instead. 50 states. Yeah. So I think, I think what ends up happening in America is we’re so homogenized that we don’t think internationally, even though we have, you know, some of the same features of an international, um, Confederated system, right?

Viktoria Soltesz (00:41:56):

That’s right. Yeah. Well, well, where you’re sitting on a huge market, everybody speaks the same language, more or less. The regulation is, is, is, is the same. Okay. Maybe Taxe is differ from state to state, but if you think about it, in Europe, everybody is killing everyone for four thousands of years. Everybody hates everyone. The language is not consistent. Well,

Jarvis Lagman (00:42:15):

I mean, and, and it’s less than a hundred years old, right? We use what, 30 years old, right? So I mean, so the idea that it’s gonna, I I, I guess actually a follow-up question. So what did Brexit do to this whole, uh, to how payments operated? And and what kind of negotiations do you have with, because I remember Jeremy mentioned a Wales bank. So how does a Wales bank, you know, deal with an English bank post Brexit?

Viktoria Soltesz (00:42:41):

Well, it shaped the system because for, for many years we didn’t know what’s gonna happen. So no really wanted to touch anything. Don’t rock the boat. Cause we don’t

Jarvis Lagman (00:42:48):

Know the entire country is high risk <laugh>.

Viktoria Soltesz (00:42:51):

Yeah, exactly. So we just didn’t know what to do, accept them, don’t accept them, advise them to start a new company. So, well, so in the middle of, of, of the complete, uh, uh, blur and, and, and and confusion, what happened there is that many companies said that, okay, I’m not gonna wait out what’s gonna happen. They started a new company in, moved to different jurisdiction, but how it affected the financial system is that now UK license cannot be passported in a year or, or with a certain restrictions. So if you had an e uh, a uk, uh, financial license, you might not be able to use it anymore for the rest of the year. And it’s my versa, you might not use your European license to serve, uh, UK customers. Now, is it clear, still not very clear. Mm-hmm. <affirmative>. So, so there are still a lot of like open questions.

Viktoria Soltesz (00:43:46):

Uh, it did affect, uh, the, uh, we call it value add tax, v t mm-hmm. <affirmative>, uh, you guys call it GS d. How these, uh, these, these countries are, are dealing with each other taxation wide. But, and it’s only my personal opinion now, UK is in a very privileged position of being very close to eu, having a lot of connections to the eu, however, having a different currency and it’s not under a European regulator anymore. Mm-hmm. <affirmative>. So it is a lot of opportunity for UK to play their cards, right. And could emerge as a new Switzerland using their, uh, very privileged position in the financial market to offer those very unique financial services, which could not be, uh, otherwise possible under on the, on the renew license saying, so they take

Jarvis Lagman (00:44:34):

Out more risks <laugh> than, than EU member, member Congress, for example. Right.

Viktoria Soltesz (00:44:40):

For example. But, but if you think about it, the only thing that you need to think of, they don’t have euro mm-hmm. <affirmative> and pound is still a very strong currency. Mm-hmm. <affirmative>. So even if you are not really breaking your neck on the risk, uh, part on the foreign exchange, you are already making a lot of money just by, you know, playing your cards Right. And dealing with another currency or currencies within EU based on your, based on your own very strong currency, which is the pound.

Jarvis Lagman (00:45:06):

That’s actually very interesting. So do you think in the long run, Brexit would’ve been a good, it would be a good thing?

Viktoria Soltesz (00:45:12):

Well, every negative can be turned into positive if you know what you’re doing. So obviously time will tell.

Jarvis Lagman (00:45:18):

Do you think you know what they’re doing? Think that’s

Viktoria Soltesz (00:45:20):

Situation. But the opportunity is definitely there. So, so yes. Uh, we are advising a couple of financial institutions in the, in the, in the UK coming up in new, new product, in new services. And the other thing is very interesting in the UK that they are very innovative when it comes to technology. Mm-hmm. <affirmative>. So they were the first one who introduced open banking. For example, open banking is something similar than, than, than you guys have preventable Venmo, right? Mm-hmm. <affirmative>. But, uh, with the twist is that you can connect your bank account, uh, to this, uh, open banking layer and you communicate sending money through this layer. So the banks are contacted to each other through a p i through the technology mm-hmm. <affirmative>. But you have an application as a front end and you can send money, accept money to each other, and it doesn’t really matter where your banking, who is your banking provider, they’re all connected to this open banking layer.

Viktoria Soltesz (00:46:13):

Now, it came up with the UK first, the good thing is that, um, there is no more K Y C when you’re opening a new account or any kind of questions from the bank because everything is, uh, uh, is running on a, on a closed loop system. So everybody trusts everyone. So no question or source of funds, no question of, you know, where the money moves. Um, so you can actually, um, uh, give authorization to financial institutions to have an access your bank account, reading your spending habits, reading your, um, uh, past purchases, uh, which could allow a lot of new technological advancements. Mm-hmm. <affirmative> and it or originated from the uk and it, and, and it’s a beautiful thing. So, so, so UK is very advanced on this.

Jarvis Lagman (00:47:00):

So, so in, um, in the United States, you know, a a lot of those, uh, for instance, those tech technology companies who sit in the middle of those transactions, they would be considered either money transmitters or payment facilitators here in the United States, uh, who, who are actually very regulated. Uh, is there the similar kind of regulation for those technology companies that sit, that develop the plat, the APIs and the platforms enable the banking to banking relationship?

Viktoria Soltesz (00:47:29):

Uh, could be approached from two different perspective. If you are actually holding funds on behalf of a third party, you have to have a financial license. You have to report back to tax office. Ooh, I can see that. You know, uh, Jeremy has a million dollar, but he didn’t declare it on the tax record. You know, kind of favor

Jarvis Lagman (00:47:46):

1.5 actually <laugh>,

Viktoria Soltesz (00:47:50):

But in this way, if you are ever touching funds of someone else or holding funds on behalf of third party, even for a, for broken second, you have to have a financial license. Okay.

Jarvis Lagman (00:48:00):

So, so it’s actually a little bit more like Zelle.

Viktoria Soltesz (00:48:02):

No. Something like that. But, but the whole idea is that if I, if I, if I can cheat my tax return and not declare my income because my money is in your pocket, you have the responsibility to report it back to the office, uh, tax office on behalf of me. So that’s the financial license. Mm-hmm. <affirmative>. But if you are acting as a, as a technology provider, a middleware between the bank and the client, for example, gateways mm-hmm. <affirmative> or, or, um, you know, connecting bank to bank through like open banking, you can get away by not having the license because you are technically having no hold of funds. You are not owning any, any money at any given moment. You are just a middleware, a gateway, a connection technologically where the information is flowing through. You only need the security standard and that’s it. Yeah.

Jarvis Lagman (00:48:52):

We see you’re basically operating as an agent of the ban of the financial institution. So there needs to be some kind of like contract between the financial institution and the, and the technology provider.

Viktoria Soltesz (00:49:05):

Well, obviously contract, but more importantly the technological connection, the api that how this, how this information is moving. So for example, you want to send some money to Jeremy, it goes through me. I am not touching the funds. So your bank is actually contacted, uh, by Jeremy’s bank and you are making the transaction, but through my platform, yes. For example, a marketplace, like you never touch the product, but you are just like connecting parties there. You don’t need a license. Oh, no. Cause we,

Jarvis Lagman (00:49:32):

We have a lot of clients even here at the firm that offer those kinds of gateway solutions and mm-hmm. <affirmative>, you know, and I’m actually just really interested in what opportunities are there, you know, to, to port some of this technology over to, you know, the eu just because, you know, it’s, it’s something that we do, you know, it might need to be structured differently. And, and I’m not sure how these technology solutions actually are able to onboard new banks, right? So I’m assuming that maybe they have a sales engine and they’re going to different banks saying, look at our api, do you wanna be part of our network? And they’re developing their own internal network, not that dissimilar from Visa, MasterCard. Right? Because if you actually think about what Visa MasterCard is, it really is an association of banks, right? Uhhuh, <affirmative>. And so what is, what are these technology platforms trying to do? They’re trying to create their own association of banks.

Viktoria Soltesz (00:50:22):

That’s right. And that, as I said, you can even start it from your own bedroom. It need a lot of development. Even further, you can always white label something else. Mm-hmm. <affirmative>, right? Uh, it’s up to your negotiations. How much is gonna be the setup fee and the running fee, it can be a couple of thousand euros. So it’s not a big investment. Mm-hmm. <affirmative>, all you need is a PS P C I D SS compliance, which is a security standard that you are not holding anyone’s car details or name or address mm-hmm. <affirmative>. So it’s like a data production kind of thing. But other than that, you can act as a gateway, as a, as a payment facilitator. The only trick, really, as I said at the beginning, or you’re holding funds or not, ifs, you need a license, if not free to go, just, just comply with the, with the, with the data protection law and the security standards. And, and that’s it for you.

Jeremy Stock (00:51:10):

Victoria, something. Yeah, I think we’re might be coming here towards the, uh, end of this podcast. One, you have a wealth of knowledge and I, I was hearing during this conversation, we could probably, and I’m sure we will, we’d be happy to have you back. We can have other conversations I’d be happy to hear about. Thank you. Who’s the ideal client, um, that, you know, are most likely our, our predominantly American audience listening to this podcast? Um, who’s the type of client that, that should reach out to you,

Viktoria Soltesz (00:51:40):

Who want to go international, who already have, uh, an online business, uh, service or product, but they don’t really know how to reach out to new jurisdictions, who to trust, which bank account to open, how to hedge, uh, the, the, the currencies with the new bank, how to negotiate better fees. What are the different payment methods that, uh, um, they need to pay attention in certain jurisdictions? So I would say that everybody needs, now, nowadays, in 2023, I would say definitely everyone who has an online presence and online payment, you will need a, a payment consultant. If it’s not p s p Angels, obviously we cannot be everywhere. You will need someone who understands this market inside out. And where I see the biggest problem is that there is no, um, no qualification that, that can prove that yes, I know what I’m talking about.

Viktoria Soltesz (00:52:34):

I know what is Visa, MasterCard, I know what is the chargeback. So you do need someone with, um, with a lot of knowledge and ex experience to, to be able to handle your funds, uh, accordingly. And I just tell you a very funny story. I had a client, um, who was, um, who was, uh, doing online gambling, uh, services, you know, slot machines online, and they wanted to go to a new jurisdiction. They spent millions to get the local license. They got ready with everything, and they opened up in a new country. The problem was that after spending a lot of marketing budget, turns out that all the payment providers who are taking gambling are very, very expensive and very shady. Mm-hmm. <affirmative> so many times it’s not, do the marketing, get the license, sort out everything legally, and then find a payment service provider and the local bank for that.

Viktoria Soltesz (00:53:28):

But nowadays, what I see, you need to see this in a, in a, in a completely opposite way. Talk to your payment provider, see who is, who is the local bank who can support your money, which is basically the lifeline of your business. Um, get engaged with that financial institution, find out what they need to onboard you as a client, and then spend the money on lawyer’s license and, and marketing and whatnot to actually penetrate the market. So when it comes to online business, now the tables have turned and, and you will need someone who is helping you in this journey because, uh, sometimes it takes much more time and energy to figure it out on your own and, and learn from your own mistakes than go to a consultancy company, consult a couple of hours, clear cut, understanding what are you allowed to do, what is the fee, and then, you know, you, you can, you can spare a lot of money and time for yourself.

Jeremy Stock (00:54:24):

Something I wanna le give you guys the last word on, but I think it’ll be an interesting prompt. Victoria, you and I were talking the other day and, and you mentioned firms like global legal law firm don’t seem to really exist much in, in, in Europe in terms of, we, we are a payments litigation firm, right? We are a kind of expertise in the payment space, particularly as a law firm. Would you guys talk about that? Maybe why that’s not the case in over there as a, and, and why it is here?

Viktoria Soltesz (00:54:53):

Good question. Why not? I don’t know. Because, uh, obviously legal perspective is something different than the payment perspective. So I’m not a lawyer, I’m not running a law firm. I know more or less what are the requirements, but I’m not the one who is signing it off and, and saying that, yes, this is it. I can guide you and I’ll help you to find the relevant law firms and as the relevant questions. But, uh, in my opinion, there would be a huge need for these kind of services combination with the payment consulting services globally for this exact reason. What I’m just, just, oh,

Jarvis Lagman (00:55:28):

Previous, for instance, one of the things you mentioned was the idea that, oh, some of these payments processors, for instance, like gambling and things like that are, you know, shady or unscrupulous. And this is why you need a law firm, right? If you’re a merchant Yes. And you know, and you have an agreement and then all of a sudden you send all sorts of funds to, um, you know, to the processor and they don’t give you the funds back. That’s why you have a law firm cuz they sue, you know, they find the people, they hunt them down and they sue them. Right. So some, some of Exactly. I think what, you know, some of the risks that you’re actually describing in terms of, I think you do some of the front end in terms of how can you structure your business in a way to mitigate your risk. Mm-hmm. <affirmative>. And I think a lot of what we do as litigators here, a global legal law firm, is that, okay, the risk happened. Everything that you feared happened, what do you do now? And, and that’s something that’s I think we can help you with.

Viktoria Soltesz (00:56:26):

And not only at the end, but at the beginning as well. Mm-hmm. With the planning. Mm-hmm. Absolutely. Because whatever justifies the law might not justify the bank. So you can be absolutely legal and to the book and to the dots. The banks yet are not going to take you simply because of the vertical. For example, what we mentioned, adult services. You are legal, you’re doing everything as per your lawyer advice or for example, taking your business off short. There’s nothing wrong with it. You’re not doing the criminal activity yet. Good luck to find a payment provider. So in this way, what I see a huge need is the payment consultant talking to the lawyer and coming up with a structure together using both of the knowledge and expertise to help the client go really global and, and, uh, and enter all those jurisdictions, which could be challenging. Yeah.

Jarvis Lagman (00:57:16):

Yeah. I mean e even something to the extent, you know, cause I remember you brought up the situation of, okay, you organize a business in Panama, right? Are there, yeah. Are there member sponsored banks in Panama that are willing to open an account? And then you could set up some kind of royalty arrangement where you’re doing transfers that way, where every, all of the merchant activities being, you know, to your Panamanian account, but then you actually get paid out as like a royalty to your European account mm-hmm.

Viktoria Soltesz (00:57:43):

<affirmative> Exactly. Or something

Jarvis Lagman (00:57:43):

Like that. Right. I mean, I think there are ways to actually structure these transactions, not necessarily in a way to do tax avoidance, but in a way to optimize your tax, you know, how how money comes in the most tax advantageous way.

Viktoria Soltesz (00:57:58):

Exactly. Exactly. And, and, and for, for, for, for the law drop, I had a client who had a, a crypto hedge fund mm-hmm. <affirmative>, and they went through everything with the lawyer. They found a very nice jurisdiction seashells, which, which actually has a very strong, uh, hedge fund, uh, regulation around it. And then they ended up with me because they couldn’t find the bank account. Why? Because it’s double, double red light, it’s offshore and it’s a hedge fund and it’s a crypto as well double the triple red block. So whatever you do, and

Jarvis Lagman (00:58:29):

They do a little porn on the side.

Viktoria Soltesz (00:58:30):

Makes sense. Yeah, exactly. On top of that too. And a bit of gambling people, the jokes side. Yes. It, it, it, it could be very challenging that even though that you do everything legally, client doesn’t understand why the banks don’t take them. And then that’s where we together with the, with the lawyers can actually help and avoid spending a lot of money on a structure which can actually result more tax or more problems or more banking costs on the long term than getting the structure maybe clearer, easier and in a different jurisdiction.

Jarvis Lagman (00:59:01):

Yeah. Or, or, or even just being able to understanding the business model, understanding the needs of the client and organizing their business in a way that they wouldn’t have thought of, but for mm-hmm. <affirmative> the advice that you and, you know, and you and, and a law firm could give, you know, with your combined experience and knowledge.

Jeremy Stock (00:59:20):

That’s right. Absolutely. Exactly. Victoria, thank you so much for coming onto the Payments Experts podcast. It’s been a real pleasure having you, uh, those listening, um, Victoria’s business, PSP Angels can be Uh, Victoria, we look forward to having you in the future. Again, uh, this is a great conversation as well as Jarvis Lagman, thank you so much for joining us today, and those of you out there, thank you for listening. Thank you for listening to this episode of The Payments Experts podcast. New episodes first and third Thursdays. If you’re interested in learning more about PEP and how Global Legal Law Firm may be able to assist you, please visit us at global legal law To schedule a free consultation, give us a call at (888) 846-8901 or email us at And once again, thank you for listening. 1, 2, 3.

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