Following are predictions from The Green Sheet as we usher in a new year. For more of the latest news, see News From The Wire on the left-hand side of this page. #h2Payment predictions for 2012 Prognostication goes with New Years like fruit cake goes with Christmas – many people don't like it, but many others find value in attempting to divine the future. However, even the best predictions, like the best fruitcakes, go stale quickly. With this in mind, here are some 2012 payment predictions:

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Nearly all bank claims filed against Heartland Payment Systems Inc. in the aftermath of its massive data theft, initially reported in January 2009, were dismissed by U.S. Southern District of Texas Judge Lee Rosenthal Dec. 7, 2011. #h2The ruling Nine banks filed complaints against Heartland following the theft of data from nearly 130 million credit and debit cards. The banks sought damages from Heartland for alleged negligence, violation of the consumer protection laws of several states and for breaching its contractual obligations to them.

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A developing trend for 2012 is called "re-commerce". It involves retailers that pay customers to turn in old electronic items. With a stagnant economy and consumers intent on stretching the dollar as far as possible, businesses like Amazon.com Inc. have launched programs that offer prepaid gift cards to consumers who trade in used gadgets such as old tablet computers and outdated cell phones.

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Statistics from the digital marketing research firm comScore Inc. show the 2011 online holiday shopping season set new retail records. The research found a 15 percent increase in sales for November and December 2011's first 48-days of the holiday shopping season. It reported almost $32 billion was spent online. There were four days during the week ending Dec. 18, 2011 when online spending exceeded $1 billion in sales, comScore said.

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With Christmas 2011 now in the past, closed-loop gift card providers are intent on pushing through to the new year. If First Data Corp.'s SpendTrend Closed-Loop Prepaid Cards November Analysis is any indication, the 2011 holiday season should prove especially bountiful for purveyors of gift card programs. The SpendTrend analysis, which tracks U.S. activations and redemptions of closed-loop, merchant-branded prepaid cards, showed that activation transaction growth in November 2011 was up 12.3 percent over November 2010. Additionally, activation dollar volume rebounded in November 2011, with an overall growth of 16.7 percent, reversing a three-month period of growth slowdown, First Data said.

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Following are two items The Green Sheet found compelling today. For more of the latest news, see News From The Wire on the left-hand side of this page. #h2Industry shows heart with holiday giving Generosity is a hallmark of many in the payments industry. Charitable giving is very much a part of the holiday season this year, as many companies are reaching out to help those less fortunate.

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A forensics exam of Google Inc.'s Google Wallet by the digital forensics and security firm viaForensics LLC revealed a number of apparent holes in the mobile wallet's ability to protect the personal information it stores. However, the ease with which these holes can be exploited to steal data remains at issue between the two companies. "We've agreed to disagree," both the researcher, viaForensics Chief Investigative Officer Andrew Hoog, and a Google representative who asked to remain on background separately told The Green Sheet.

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The Green Sheet Inc. offices will be closed until 8:30 a.m. Tues., Dec., 27, 2011. We wish all our our readers a happy, healthy, prosperous holiday weekend and look forward to catching up with you upon our return. Early indications are that holiday spending is up this year. Here's hoping this trend continues throughout the weekend.

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The arrival of 2012 brings a new prepaid debit card option for tax refund recipients in several states. Following New York state's early December 2011 announcement of its plan to add prepaid cards as a refund delivery option in 2012, alongside direct deposit and paper checks, South Carolina and now Louisiana have jumped on board.

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Imagine pumping gas and watching a Jay Leno monologue. Imagine grabbing a taxi and getting a local news, weather and sports update on the trip across town. Imagine waiting for a pharmacy prescription and viewing an NBCUniversal Media LLC game show or comedy while you wait. These scenarios are no longer futuristic. They are soon to be implemented due to a new agreement between VeriFone Inc. and NBC Owned Television Stations, a division of NBCUniversal. Effective Jan. 1, 2012, NBC will deliver news and information along with clips from its regular entertainment programming on VeriFone's Paymedia Solutions payment-enabled media terminals to more than 12,000 taxis, thousands of gas stations and other digital out-of-home platforms.

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Following are a few recent items The Green Sheet found to be of particular interest to payment pros. For more of the latest news, see News From The Wire on the left-hand side of this page. #h2FCC complaint lodged over Google Wallet In a letter delivered this week, Stanford University Professor Barbara van Schewick asked the Federal Communications Commission to investigate Verizon Wireless's decision to block Google Wallet on its new smart phone. Van Schewick believes Verizon's decision to block the Google Inc. app violates FCC rules forbidding the blocking of applications or devices.

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Here is a peek at a few stories we are working on now at The Green Sheet:

• viaForensics recently identified security holes in the Google Wallet. viaForensics' Chief Investigative Officer Andrew Hoog will talk about the findings and what it means to the future of mobile payments.
• Heartland Payment Systems Inc. Chief Executive Officer Robert O. Carr will share his thoughts on the dismissal of the majority of claims filed against the company in the wake of its 2008 data breach.
  

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A year ago Sen. Robert Menendez, D-N.J., sponsored the Prepaid Card Consumer Protection Act of 2010. On Dec. 17, 2011, Menendez introduced a similar bill designed to foster consumer protections and eliminate "hidden" fees on prepaid cards. The legislation, called the Prepaid Card Consumer Protection Act of 2011, targets what Menendez called the "most egregious hidden fees and let consumers know what the fees are before they buy the cards."

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Following are a few of today's news items The Green Sheet found to be of particular interest to ISOs, merchant level salespeople and other payment professionals. For more of the latest news, see News From The Wire on the left-hand side of this page. #h2Mobile payments to phone bills insecure An analysis released Dec. 14, 2011, by the Consumers Union stated protections commonly extended to credit card and debit card users may not apply to users of smart devices when their devices are lost or stolen, when billing errors occur or when purchased items are returned. The analysis also found many protections wireless carriers have said are provided to consumers are not disclosed in customer contracts.

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In November 2011, the PCI Security Standards Council (PCI SSC) held a first of its kind election. Nearly 500 council members from around the world voted on topics for Special Interest Groups in 2012. The results were: cloud computing, e-commerce security, and risk assessment. These topics were the top finishers on a list of seven issues put before members as possible subjects for SIGs. The seven topics were trimmed from a list of 13 possible subjects suggested by the Payment Card Industry (PCI) Data Security Standard (DSS) community.

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Self-checkout POS terminals in 23 northern California Lucky Supermarkets stores were tampered with to allow thieves to collect card and PIN number data and steal thousands of dollars from Lucky customers. Save Mart Supermarkets, which owns and operates the Lucky supermarket chain, said that as of Dec. 7, 2011, more than 500 customers had reported fraudulent activity in their accounts as a result of the skimming operation.

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According to a Research and Markets report, the total revenue from electronic payments in Australia was estimated at about $3.8 billion in 2010. Among one of the largest revenue generators – telecommunication – prepaid telecom products comprised a "significant proportion" of revenue, the report said. Prepaid mobile voice services are reportedly the largest revenue segment, followed by calling cards, prepaid mobile Internet access, digital music purchases and gift cards. "The market is rapidly developing and the arrival of rechargeable magnetic cards is a major new development," the report noted.

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A partnership between MasterCard Worldwide, watch manufacturer LAKS and U.K. prepaid card issuer Vincento Payment Solutions Ltd. resulted in the launch of Watch2pay, called the U.K.'s first prepaid contactless wristwatch. The watch is integrated with MasterCard's PayPass near field communication (NFC) technology to enable "Tap & Go" POS purchases of up to 15 British pounds per transaction at over 70,000 U.K. retailers, MasterCard said.

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A recent Payments Spotlight podcast from the Federal Reserve Bank of Atlanta discussed the myriad challenges facing the mobile payments industry. The podcast featured economist David Evans, founder of the business consulting firm Market Platform Dynamics and co-author of Paying with Plastic, a comprehensive book on the payments industry. Jennifer Windh, Payments Risk Analyst at the Atlanta Fed, conducted the interview. She began the discussion by asking Evans about the viability of Isis, the mobile payment venture created by AT&T Mobility LLC, T-Mobile USA Inc. and Verizon Wireless.

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A coalition of merchant groups led by the National Retail Federation went to Federal Court in Washington, D.C., in mid-November 2011 to challenge the Federal Reserve Board's final rule on debit card interchange fees. The Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 directed the Federal Reserve Board to limit debit card interchange fees to "reasonable and proportional" issuer costs. The Federal Reserve's final rule, which went into effect Oct. 1, 2011, limits the debit card interchange fee to 21 cents plus a small allowance for fraud prevention.

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Beginning in 2012, New York state taxpayers will be given the option to receive state income tax refunds on prepaid cards. The New York State Prepaid Refund Card will be available to taxpayers as a tax refund option alongside paper checks and direct deposit. Ed Walsh, Public Information Officer at the New York State Department of Taxation and Finance, said the MasterCard Worldwide-branded cards will be issued by Bank of America Corp. and taxpayers will be able to access funds via the Allpoint ATM network, which boasts 43,000 surcharge-free ATMs worldwide. The prepaid card option will appear on 2012 tax forms, Walsh added.

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After 12 years in Rohnert Park, Calif., creating the leading payments industry news and education vehicle dedicated to ISO and merchant level sales success, The Green Sheet Inc. moved its headquarters north to an exquisite new campus in Santa Rosa, Calif. While access to popular online forums and staff was interrupted during the move, we are now back up and running in our new quarters located convenient to downtown and near the Coddingtown Shopping Center at 1160 N. Dutton Ave., Suite 200, Santa Rosa, CA 95401.

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In response to nFinanSe Inc.'s breach of contract and antitrust lawsuit against InComm, the Atlanta-based prepaid card distributor said the general purpose reloadable (GPR) card provider's claims are baseless and meritless. The lawsuit alleges InComm, which distributes nFinanSe's GPR cards, is blocking access by merchants to the Florida-based company's cards to force nFinanSe to join InComm's Vanilla Reload Network. According to the complaint filed Oct. 31, 2011, in the U.S. District Court – Northern District of Georgia, InComm attempted to coerce nFinanSe into a "price-fixing conspiracy" when it told nFinanSe it would not distribute nFinanSe's GPR cards unless nFinanSe agreed to join the distributor's reload network, on which $3.95 is charged cardholders to reload prepaid cards – a dollar more than what nFinanSe charges.

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As part of Boston's annual Holidays on Main Streets campaign, Boston Mayor Thomas M. Menino officially launched the Boston Meter Card. The proprietary, closed-loop prepaid card is designed for use at 7,000 single-space parking meters across the city. Menino said the card will not only make it easier for people to pay for street parking, as it eliminates the need for drivers to feed meters with coins, but it will also promote local holiday shopping.

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