A decade ago, credit card usage took a dip as overspent consumers stopped spending, prompting card issuers to innovate; hackers allegedly confiscated thousands of credit reports from Experian; and Visa Inc. was embroiled in a lawsuit against First Data Corp. to protect its brand. Economic influences continue to shape consumer behavior, and the payments industry is quick to respond.
Fears that Americans drowning in debt would thwart credit card spending, issuers were scrambling to reinvent the shape and function of traditional plastic. Enter the key fob. Discover Financial Services rolled out the teardrop-shaped 2GO Card and protective case, which consumers could attach to key chains and briefcases as a visible spending tool.
Between April 2001 and February 2002, hackers acting as Ford Credit employees allegedly used an authorization code to gain illegal access to more than 13,000 credit reports from Experian, one of three major credit-reporting agencies. Detection of the scheme surfaced when reports listed unauthorized credit checks by Ford. The case was under FBI investigation.
Visa sued First Data, alleging the processor threatened to sully the Visa name with a new service that lowered costs by keeping transactions in-house, a violation of Visa rules stipulating all transactions initiated with Visa-branded cards must past through the VisaNet network. First Data had been testing a service that would keep some transactions in-house.
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