Dirty money: Sex and the payments industry

In 2016, China's Alipay introduced a social media feed called Circles in late November. The launch quickly went awry, with users sending racy photos in exchange for money within hours of the app's debut. The company hurriedly took down pictures and blocked related accounts permanently.

Alipay, part of Ant Group, could have seen this coming if it had looked at other attempts to combine social media and payments. The social image-sharing app Snapchat launched Snapcash — an adaptation of Square Cash — in 2014, and it was immediately adopted by adult performers despite Snapchat's prohibition of monetizing porn via its service.

Nothing grabs attention quite like hiring an adult actress as a spokesperson.

In 2011, Blue Global Media, the company behind LittlePayday (a lead generator for short-term loans) hired the porn star Bridget Powers — known to her fans as Bridget the Midget — for its advertising.

Chris Kay, who was then chief executive of Blue Global Media, told American Banker, "we wanted to do something a little crazy, to be honest with you, so we partnered with Bridget the Midget."

Payday lending is "a very competitive landscape," Kay added. "To be on the first page of Google for the searches for payday loans, these marketers have to know what they're doing."

But Blue Global attracted the wrong kind of attention; in 2017, the FTC halted Blue Global's operations, stating that the company promised to match applicants with a network of 100 or more lenders, but instead sold applicant data "to a variety of entities without regard for how the information would be used or whether it would remain secure." Very few of those buyers were actual lenders, according to the FTC.

Facing a judgment of $104 million from the FTC, Kay and Blue Global fled for Chapter 7 bankruptcy, VentureBeat reported at the time.

Mastercard and Visa's prompt shunning of Pornhub illustrates just how delicate the mainstream payments industry's ties to adult entertainment can be.

After a New York Times story accused Pornhub of hosting child abuse and nonconsensual videos, the card brands investigated on their own — and didn't like what they saw.

“Our investigation over the past several days has confirmed violations of our standards prohibiting unlawful content on their site,” Mastercard said in a statement. “We instructed the financial institutions that connect the site to our network to terminate acceptance.”

And while Pornhub acted swiftly to protest the card brands' decision, it also took drastic action of its own. It enacted a blanket rule that if a video's uploader wasn't verified to Pornhub, the video would be taken down — a move that cut Pornub's video count from 13.5 million to 3 million, CNN reported.