TEMPE, AZ – In all likelihood the behind-the-scenes financial activity in the adult entertainment space will experience no glitches after Friday’s closing of one of the largest credit card acquiring banks for so-called “high risk” merchants, but merchants who processed plastic payments through Humboldt Merchant Services LP need to be aware that things could change.Humboldt, which was owned by First National Bank of Arizona, came under the receivership umbrella of the U.S. Federal Deposit Insurance Corporation on Saturday when FNBA completed its merger with First National Bank of Nevada. The previous day, the Nevada bank was declared insolvent and closed by the U.S. Office of the Comptroller of the Currency. Its $3 billion in deposits were purchased by Mutual of Omaha Bank, a less-than-one-year-old subsidiary of 100-year-old insurance company Mutual of Omaha, but the other assets of both banks — including loans and the merchant-account processor HBMS — have yet to be settled with other institutions.

Humboldt maintains a portfolio of more than 20,000 credit card merchant accounts. It is not known how many of those belong to “high-risk” merchants, but Humboldt representatives hastened to assure their clients that processing services would not be disrupted.

“I would like to take this opportunity to assure you that our daily ongoing operations and management remain intact,” Humboldt President Ken Musante pledged in a statement published on the service provider’s website. “The Federal Deposit Insurance Corporation (FDIC) assumed majority interest in Humboldt Merchant Services to ensure our ongoing operations and continued growth.

“…[O]ur customers will continue to receive uninterrupted payment processing,” the statement continued. “Additionally, processing of funds have not and will not be impacted. Settlement and customer support will continue to operate as normal with no disruption in daily activities.”

Although merchants’ deposit accounts with FNBN and its affiliates remain secure even if their balances exceeded the FDIC’s insurance limits, merchant services provider NETBilling said Humboldt clients could experience service disruptions during the transition.

“Since [First National Bank of Nevada] is no longer intact, [Humboldt] must find a new bank to own and support the portfolio of accounts,” according to a statement NETBilling sent to its clients. “While this transition is in place, there is a small chance that the accounts could be in jeopardy, even though the FDIC is backing [Humboldt]. While we personally feel all will go smooth for [Humboldt] and business will continue without delay, there is always a chance of things not going well.”

08-01-08 UPDATE:

“Since releasing our merchant newsletter concerning HBMS merchants several days ago, we have since been involved in several calls between our management team, HBMS, merchants and the FDIC,” Mitch Farber, CEO of NetBilling assures. “We are confident that HBMS is on the right track, a very strong and thriving entity and will continue to service merchants without any issue.”