Hook
A bank issues a corporate card. A few layers later, it's sold online as a "no KYC" crypto card.I call it the corporate card loophole. Here's how it works, step by step:1. A licensed bank issues or sponsors the card program.2. A program manager runs the program. An issuer processor provides the tech to create and authorize the cards.3. A corporate or fintech client further down the chain is allowed to hand out cards to its "employees."4. That client isn't handing them to employees. It's marketing them to the public as "no KYC" crypto spend cards.5. Buyers load crypto, get a card, and spend anywhere the network is accepted. Including, per The Economist's reporting, people locked out of the Western financial system by sanctions.The bank at the top of the chain often can't see step 4. Each layer only sees the one next to it.That's how cards issued by banks large and small, including Fifth Third, Central Trust Bank and Sutton, have ended up repurposed this way.What a sponsor bank can check this week:→ Every program where a client can issue cards to third parties, not just its own staff
→ How many cards each "corporate" client has issued against its actual headcount
→ Where those cards are being spent, and in which currencies they're loaded
→ Whether anyone has searched the program's BIN alongside "no KYC"Nested programs aren't new. What's new is how easy they are to sell.If you run a card program, which of those four checks would surprise you most?
