“Grok, Read My ISO Agreement”

Before having an attorney review an ISO agreement, consider having an intelligent LLM AI take a look at it and alert you to any immediate red flags. After all, some accusations of purported funder improprieties these days are actually rooted in actions well within the rights of the funder in the ISO agreements. D’oh! But if such agreements are too long or too legalese-sounding for you to make an immediate judgment, LLMs like ChatGPT-o3 or Grok4 or Claude or Gemini etc have become so adept at understanding a subject and communicating in a way that the user understands, that perhaps it’s worth having them take a look. (Maybe even at your existing agreements!)

For example, deBanked obtained a 15-page ISO agreement and asked Grok4 a bunch of casual questions. One of them was, “can this funder backdoor my deals?” Surprisingly, it named some weaknesses and loopholes that the broker should be aware of even if they were not easily exploitable. On the other hand, this ISO agreement already had some broker protections built in that the LLM pointed out, such as an in-house funding clause where the broker would be paid the commission if their submitted deal was funded by the funder’s in-house sales team within 30 days of the broker having submitted it. Did you know they had an in-house sales team?!?! Grok4 did!

Grok4 also gave me the heads up that there’s a 30-day clawback period and that my future renewal commissions would be forfeited if I were to be terminated for cause. Ironically, the LLM also gave me some unsolicited advice, telling me to diversify my funders and to watermark my docs “as per the new tool.” When I asked what tool it was even talking about, it specified Aquamark, which appeared on this site just a few months ago. Grok4 also said to use deBanked, lol. Thanks!

Recommendations to Protect Yourself

Operational Steps: Timestamp submissions, watermark docs (as per the new tool), and require written confirmations for all merchant interactions. Diversify funders.

Contract Tweaks: Negotiate for audit rights, higher breach penalties, or tech tracking of merchant contacts. Extend non-interference to 3-5 years (common in MCA).

Industry Tools: Join broker networks or use platforms like deBanked for alerts on shady funders.

Curious what your ISO agreements say? I used Grok4 for this experiment. Of course, you should actually be using a lawyer for a real assessment. Here’s a list of some to get you started.