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Breaking News articles for May 2008

One platform, one processor

Friday, May 30, 2008

In an effort to provide better value in more cost-effective ways, Wells Fargo & Co. and Bank of America Corp. agreed to a joint venture in May 2008 to operate a single, combined automated clearing house (ACH) platform. The new company, Pariter Solutions LLC, will become the country's largest processor of ACH receivables. Pariter (Latin for "together") will allow BofA and Wells Fargo to gain economies of scale by eliminating single bank platforms, which will reduce unit costs and overhead. The economies of scale – a combination of increased transaction volume and a reduction of platform support costs – are expected to double with this partnership. Company officials expect payment processing operations to begin in late 2009.

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Processing giants go separate ways

Wednesday, May 28, 2008

Chase Paymentech Solutions LLC, the behemoth acquirer built from a joint venture between First Data Corp. and JPMorgan Chase & Co. 12 years ago, will cease operations in its current capacity by the end of 2008. The two companies will continue normal operations in the interim. Following the transition, First Data and JPMC will operate as separate payment businesses. In 2007, Chase Paymentech processed approximately 19.7 billion payment transactions and generated an average of more than $700 billion in annual bank and debit card volume. The company's customer base includes almost 70 percent of e-commerce businesses and more than 600,000 merchants (some with multiple outlets) in nearly 1 million locations worldwide.

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No advance for AdvanceMe appeal

Friday, May 23, 2008

On May 15, 2008, the United States Court of Appeals for the Federal Circuit in Washington, D.C. rejected an appeal filed by AdvanceMe Inc. The appeal stemmed from a judgment by a lower court invalidating the company's patent, which provided merchants a means to automatically repay cash advances via credit and debit card receivables processing. The order came nine days after a three-judge panel heard the appeal. The court upheld the August 2007 U. S. District Court for the Eastern District of Texas ruling invalidating the patent because "it is obvious and anticipated," stated Judge Leonard Davis, in the Memorandum Opinion and Order. "The patent-in-suit, simply put, is a computerized method for securing debt with future credit card receivables.

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Prepaid phone trafficker convicted

Thursday, May 22, 2008

Muhammed Mubashir of Sugar Land, Texas, pled guilty in the U.S. District Court for the Southern District of Texas on May 19, 2008, to two charges of criminal contempt for disobeying a federal injunction prohibiting him from purchasing or exporting prepaid mobile phones. With this conviction, wireless prepaid mobile phone companies scored a victory in their continuing efforts to turn the tide of scammers in the United States.

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The facts on FACTA

Monday, May 19, 2008

Following is a special report submitted exclusively to The Green Sheet by Ross Federgreen, founder of CSRSI, The Payment Advisors: I have read a number of recent articles in The Green Sheet on the Fair and Accurate Credit Transaction Act of 2003 (FACTA). Although the articles provide accurate information, I believe additional clarifications are needed, and further serious questions and issues must be raised. Also, the Credit and Debit Card Receipt Clarification Act of 2007, HR 4008, passed May 14, 2008, in the U.S. House of Representatives. This will have a material effect on all of these discussions if it is enacted into law. I will discuss this legislation, but first some important background to frame the conversation.

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Interchange under the gun in D.C.

Thursday, May 15, 2008

The next battle in the war over interchange fees began on Capitol Hill May 15, 2008, when the Judiciary Committee Antitrust Task Force held a hearing on House of Representatives bill 5546, otherwise known as the Credit Card Fair Fee Act of 2008. If enacted into law, the bill would allow merchants to negotiate as a group the interchange fees they are charged by Visa Inc. and MasterCard Worldwide, the card brands that set fees per transaction that merchants must pay for accepting electronic payments.

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Prepaid cards for online gamers

Wednesday, May 14, 2008

Online gamers who enjoy getting lost in the virtual worlds created by Gala-Net Inc. can now purchase prepaid cards at Target Corp. stores redeemable online for in-game items and accessories. Called gPotato Game Cards, the cards can be bought for $15 or $30 at Target and used to purchase items that add power and abilities to online gaming identities.

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Canada piloting chip and PIN

Wednesday, May 14, 2008

To enhance data security, as well as reduce credit and debit card-related fraud and identity theft, the Canadian payments industry is rolling out a chip and PIN smart-card payments program in Kitchener-Waterloo, Ontario. The pilot program, which will run through October 2008, will render all 90 local area merchants' POS terminals compliant with the Europay International, MasterCard Worldwide and Visa Inc. (EMV) smart-chip-card standard.

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Multiple Web milestones for The Green Sheet

Monday, May 12, 2008

On April 28, 2008, The Green Sheet Inc.-owned RodsandWheels.com surpassed 1 million hits for a single month, marking a historic achievement for the Rohnert Park, Calif.-based company. Following in the footsteps of GS Online – The Green Sheet's main Web site – RodsandWheels.com is fast becoming the online destination for its target audience: car clubs and car enthusiasts of all stripes worldwide. Webalizer, a Web server analysis program, tracks activity for the company's Web sites. Latest totals for RodsandWheels.com show 1,095,552 hits in April 2008; on a daily basis, the Web site received 36,518 hits. But even more telling is that it experienced over 3,500 unique visits every day in April. During each of those visits, five Web pages, on average, were viewed.

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Removing e-merchants from payment data loop

Thursday, May 8, 2008

NACHA – The Electronic Payments Association teamed up with online payment solutions provider eWise Systems USA Inc. to offer the Secure Vault Payments Switch (SVP), which is a new online payment alternative that allows consumers to complete transactions online without sharing financial data or account access. NACHA selected eWise Systems as the network provider for SVP in the United States after a successful proof of concept phase. "Our company's technology was already live in other countries, so the prior experience was a deciding factor in making eWise the technology provider for SVP in the States," said Richard Brierly-Jones, Executive Vice President of eWise.

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Revenues up in downturn

Monday, May 5, 2008

The payments industry has taken a beating lately in the media. Today's ISOs and merchant level salespeople (MLSs) must deal with regulatory legislation, security breaches, fraud, myriad new products and services, unprecedented scrutiny – the list seems endless. Regardless of recent media attention, the payments industry is healthy. Net earnings for fiscal year 2007 and the first quarter of 2008 were up overall despite higher credit card costs, market fluctuations and a deepening economic downturn.

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Prepaid players join for expansion

Thursday, May 1, 2008

In April 2008, First Data Corp., the world's biggest merchant acquirer, expanded its prepaid market footprint by acquiring InComm Holdings Inc., one of the largest distributors of stored value gift and prepaid products in the United States. Terms were undisclosed; the acquisition is subject to closing conditions and regulatory approvals and should be completed during the second quarter of 2008. First Data is confident the acquisition will make it more efficient. "Clearly we'll be working through the detailed integration plans over the next few weeks and months, but I think the key point here is that this is really a growth story on both sides and not a consolidation story," said Mark Herrington, President of Prepaid Services at First Data.

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Prepaid players join for expansion

Thursday, May 1, 2008

In April 2008, First Data Corp., the world's biggest merchant acquirer, expanded its prepaid market footprint by acquiring InComm Holdings Inc., one of the largest distributors of stored value gift and prepaid products in the United States. Terms were undisclosed; the acquisition is subject to closing conditions and regulatory approvals and should be completed during the second quarter of 2008. First Data is confident the acquisition will make it more efficient. "Clearly we'll be working through the detailed integration plans over the next few weeks and months, but I think the key point here is that this is really a growth story on both sides and not a consolidation story," said Mark Herrington, President of Prepaid Services at First Data.

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