Can a business process credit cards for another business?

money launderingIs this legal? A merchant owns two businesses. Business one has a merchant account, and business two does not because most customers pay by check, ACH or wire. However, sometimes business one runs transactions for business two and then moves the money accordingly for accounting.

The answer is no. The above is considered laundering. It’s also a violation of card acceptance rules for a business to accept deposits for a business that does not have a valid merchant agreement.