Visa Wants Account Numbers Off Receipts

In an effort to help combat fraud and identity theft, Visa U.S.A. will implement a new account truncation policy that will require its merchants with new point-of-sale card terminals to display only the last four digits of a customer's credit card number on receipts and to eliminate the card's expiration date from receipts.

The policy goes into effect July 1, 2003. Visa wants all merchants and all terminals to comply with the rule by July 2006. (MasterCard said adoption of its all-terminal policy goal is April 2005.)

Members of Congress, led by Sen. Diane Feinstein (D., Calif.), have introduced legislation that would require all credit card terminals to truncate credit card numbers within four years. Fifteen states, including California, have phased out the use of terminals that display all of a customer's account information.

FDC to Pay $3 Million in Settlement

First Data Corp. will pay the U.S. Department of the Treasury $3 million in a settlement for allegedly failing to notify federal authorities of suspicious transactions through its subsidiary Western Union. Anti-money laundering laws, which took effect in January 2002, require banks and other businesses to report suspicious transactions made by their customers.

In a report filed with the Securities Exchange Commission, First Data neither admitted nor denied the charges. The company agreed to do more testing of its compliance systems by June 30, 2003 and to file new reports on suspicious transactions from 2002 at U.S. locations.

Capital One CFO Resigns

David M. Willey, Executive Vice President and CFO of Capital One Financial Corp., resigned March 3, 2003 after receiving a Wells notice from the SEC. The notice alerted Willey that he likely would be charged with insider trading in a civil lawsuit. (Recipients of a Wells notice are allowed to explain their side of the story and possibly convince regulators that action against them is unnecessary.) Neither the company nor any other member of management received a Wells notice.

The SEC is investigating Willey's sale of shares and exercise of stock options two months before Capital One announced an increase in reserves for bad loans, which caused its stock to drop 40%. The company is currently looking for a new CFO. Dave Lawson, President and CEO of Capital One Auto Finance, will assume the role of acting CFO until a replacement for Willey is found.

308,000 Jobs Lost in February 2003

The unemployment rate reached 5.8% in February 2003 (a 10th of a percentage point higher than the previous month), after U.S. businesses cut 308,000 jobs, the U.S. Labor Department reported. Nearly 8.5 million people were unemployed in February.

The February job cuts are the largest since November 2001, when companies slashed 327,000 jobs after the September 11, 2001 terrorist attacks.

ANNOUNCEMENTS

InterCept Consolidates Merchant Services

InterCept, Inc. has restructured its merchant services division. Effective March 1, 2003, all of InterCept's merchant services operations, including Internet Billing Co., InterCept Payment Solutions (formerly Electronic Payment Exchange) and InterCept's merchant portfolio operations in Tennessee, will operate as a single business unit known as InterCept Payment Solutions, Inc. John M. Perry will oversee the unit as Chief Executive Officer. Several new key appointments were announced as part of the restructuring (see Appointments section of FYISOs).

Intellect Announces EMV 2000 Certification

Melbourne, Australia-based Intellect announced that its AERO terminal is the world's first EMV 2000 Level 1-certified mobile device. The AERO is widely used in international markets such as Australia, Brazil, Germany, Greece and The Netherlands by organizations and businesses such as police forces, delivery companies and taxi firms.

CrossCheck Products Show Increased Use

CrossCheck, Inc. announced significant growth in the use of its check payment and guarantee systems, ChecksByNet and CheckNow. The total dollar amount of checks processed through ChecksByNet in 2002 increased 164.8% from 2001, and the total dollar amount of checks processed through CheckNow in 2002 increased 497.6%.

ChecksByNet enables online consumers to write checks over the Internet. With CheckNow, consumers give merchants check information over the phone or fax, and the merchant submits it to CrossCheck through a secure Web page.

Tranax Releases Another 3DES ATM

Tranax Technologies, Inc. released another fully compliant 3DES-encrypted ATM - the Mini-Bank 2100 ATM (Tranax earlier announced the availability of its 3DES-compliant Mini-Bank 1500 ATM). According to Visa, effective Jan. 1, 2003 all newly deployed ATMs should support 3DES. For MasterCard, all new-to-market ATMs must be compliant by April 1, 2003, and existing ATMs must be compliant by April 1, 2005.

TransAKT certified by Moneris

Wildcard Wireless Solutions Inc.'s wireless point-of-sale terminal, the TransAKT, received certification from Moneris Solutions Corp. and is fully certified and available for sale in Canada.

PARTNERSHIPS

Infinity Data Goes with Lipman

ISO Infinity Data Corp. will purchase and deploy more than 6,000 of Lipman Transaction Solution's NURIT point-of-sale terminals over the next year. The agreement between Lipman and Infinity Data is valued at approximately 1.8 million dollars. In addition, TASQ Technology, part of First Data Merchant Services, a subsidiary of First Data Corp., extended its agreement with Lipman to include both wired and wireless NURIT products.

TDS, Hypercom, Visa Team Up at Drive-thru

Hypercom Corp., Texas Digital Systems, Inc. (TDS) and Visa U.S.A. have combined their technologies at quick service restaurants' drive-thrus in a pilot program, enabling patrons to pay for their food and beverages using credit or debit cards. TDS is integrating its order-confirmation displays with Hypercom's card payment terminals and Visa's processing services. The program is being tested initially at five locations in the Atlanta area; other locations will follow in Florida, Georgia, Ohio and Wisconsin.

Bridgeview Chooses Golden Eagle

Bridgeview Payment Solutions, a subsidiary of Bridgeview Bank, selected Golden Eagle Leasing, Inc.'s microticket leasing program for its credit card transactions. The companies expect the partnership to result in several thousand leases.

Experian Hires CardCops

Experian announced plans to use CardCops.com's proprietary technology to fight credit card fraud. Experian will offer the service to financial institutions that grant credit cards or process online credit card transactions. CardCops monitors the Internet daily, looking for compromised credit cards issued by participating Experian clients.

SafeCHECK and PhoneCharge Partner

SafeCHECK will combine its online electronic check verification and processing technology with PhoneCharge, Inc.'s (PCI) interactive voice response system to provide merchants with the ability to accept checks over the phone and the Internet.

Global Payments to Authorize for Visa

Global Payments Inc. will participate in Visa U.S.A.'s POS Check Service program as an acquiring processor and a third-party check authorization source. Global Payments will provide services such as authorization, capture, clearing and settlement. The program will be available in the U.S. market in early third quarter 2003.

FDC Picks RDM Imagers

RDM Corp. announced First Data Corp. will "Class A" certify its MICR imaging peripherals. RDM also will integrate the products with First Data's TeleCheck Electronic Check Acceptance service, which integrates checks to electronic items. The imaging products will be sold through all First Data sales channels.

SchlumbergerSema in Citi Cards

SchlumbergerSema provided Citi Cards, a part of Citigroup, the smart cards, card readers, loyalty applications and software applications for its smart card products, the "Citi.You card" and the "Citi Smart Card." Schlumberger's technology includes the Cyberflex Palmera 32K, a secure, multi-application financial smart card for credit and debit and loyalty programs.

NPC Processing for MGMA Members

National Processing Co. (NPC), subsidiary of National Processing, Inc., announced it is now a Medical Group Management Association (MGMA) AdminiServe partner. Through the partnership, NPC will provide merchant processing services such as card authorization and settlement services for Visa, MasterCard and debit transactions to MGMA's 19,000 members.

TeleCheck at CVS/pharmacy

CVS/pharmacy will use First Data Corp.'s TeleCheck Services, Inc. database service for verification and authorization of customers' paper checks at the point-of-sale. TeleCheck's database of check writer information contains data from more than 340,000 subscribers.

ACQUISITIONS

Symbol Acquires 2nd Company

Symbol Technologies, Inc. acquired ImageWare Technologies, Inc., provider of customer relationship management (CRM) and mass-customization software solutions for the retail marketplace. Symbol will integrate ImageWare's software with its own solutions, such as mobile POS, product locator, mobile voice-over IP and integrated mobile payment solutions. This comes on the heels of Symbol's acquisition of the assets of @pos in September 2002.

First Merchants Acquires CNBC Bancorp

Muncie, Ind.-based First Merchants Corp. completed its merger with CNBC Bancorp of Columbus, Ohio. CNBC Bancorp and Commerce National Bank, its wholly owned subsidiary, will become the first affiliate bank headquartered in Ohio under First Merchants Corp.'s family of 10 community banks. Commerce National Bank will continue to operate as a separate entity with its own charter and board of directors.

Cardtronics Buys More ATMs

Cardtronics reported its ATM network has reached 10,000 machines with the acquisition of XtraCash ATM, Inc.'s ATMs and processing contracts for 938 Winn-Dixie stores located throughout the Southeast. Cardtronics also recently acquired 22 ATMs and contracts from CenterCourt Cash, Inc. in February 2003 and 1,200 ATMs from Diebold, Inc. in October 2002.

APPOINTMENTS

Restructuring at InterCept

As part of a restructuring in its merchant services division, InterCept, Inc. announced the appointment of several new key officers. Raymond Moyer, President, CEO and founder of Electronic Payments Exchange (EPX), was named President of InterCept Payment Solutions; Tim Barnett will serve as Executive Vice President and Chief Operating Officer of InterCept Payment Solutions; Julie Counterman was named Executive Vice President and Chief Marketing Officer for InterCept Payment Solutions; and Pam Clepper was named Executive Vice President of the financial institution division of InterCept Payment Solutions.

PULSE Hires Financial Industry Vet

PULSE EFT Association announced Marie Braeutigam has joined its sales and member development team, serving the Michigan, Ohio and Pennsylvania markets. Braeutigam has more than 25 years of experience in the financial industry: she worked 22 years with Kalamazoo, Mich.-based First of America Bank (now National City of Cleveland) and the last four years at the NYCE network in EFT processing sales.

Two Sales Managers Join UBC

United Bank Card, Inc. (UBC) hired Brian Jones and Tom Goad as National Sales Managers to serve in UBC's ISO Relations department. Jones previously worked at Concord EFS, Inc., and Goad served as the former Vice President of Redwood Merchant Services.

ImageWare Founder Continues at Symbol

Bryan Amaral joined Symbol Technologies, Inc. as Vice President of Clienteling and Personalization Solutions for the Retail-Mobile Commerce Division. Amaral, a 20-year retail technology industry veteran, was the founder and Chief Executive Officer of ImageWare, which Symbol Technologies recently acqired.

CNBC Founder Joins First Merchants Board

Thomas D. McAuliffe, founder and President of CNBC Bancorp, which recently merged with First Merchants Corp., will join the First Merchants Board of Directors.

BOTTOM LINES

• A Bank of Tokyo-Mitsubishi survey of 78 U.S. retail chain stores reported that same-store sales increased 0.8% in February 2003 compared with an increase of 6.2% a year ago. Economists attribute the flat sales to winter storms across the country, a lackluster economy and the threat of war with Iraq.
• The Home Depot, Inc. estimates that it will open 200 stores in 2003; 84 of these stores will be outside big cities in more rural areas, The New York Times reported.
• Retail property vacancies in northern New Jersey's major shopping corridors dropped to a historic low of 2.0% during 2002, according to R.J. Brunelli & Co., Inc.'s 13th annual study of this area.
• Wal-Mart Stores, Inc. will open Sam's Club warehouse stores in three cities in Ontario, Canada.
• The Commerce Department reported consumer spending dipped 0.1% in January 2003, its first drop since September 2002.