FTC Wins its Largest FDCPA Judgment

The Federal Trade Commission has won a $10.2 million judgment against a debt-collection operation. The judgment against National Check Control represents the largest judgment in FTC history for violations of the “Fair Debt Collection Practices Act.” In a complaint filed in May 2003, the FTC alleged that the defendants violated the FDCPA by harassing and threatening consumers with claims that they owed money for checks returned for insufficient funds. The defendants made repeated phone calls, sent threatening letters and falsely threatened that consumers could face civil or criminal charges if they did not pay the debts. The FTC alleged that in many cases the consumers did not owe the money or owed far less than the defendants claimed.

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GEMPLUS 2Q/05

Smart card specialist Gemplus reported that second quarter net sales were up 12% to $285.8 million and that gross profits rose nearly 18% to $96.8 million. The Company said it achieved its highest gross margin in four years and its ninth consecutive quarter of continuous strong progress during the quarter. In the financial services sector, Gemplus posted a 12% gain in sales to $60.8 million. In total, Gemplus shipped 16.8 million smart payment cards, up 30% year-on-year. Payment microprocessor card revenue rose 31% year-on-year. Bank cards continued to grow very strongly, driven by broad activity in EMV deployment across all regions, particularly in the UK and Turkey. The second quarter saw the first EMV shipments by Gemplus to the Netherlands, Italy and Japan. For complete details on Gemplus’ second quarter performance as well as prior quarters, visit CardData (www.carddata.com).

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Portfolio Recovery Assc Q2 Profits Up 34%

VA-based Portfolio Recovery Associates posted net income of $9.1 million, a gain of 34% year-over-year. Total revenue increased 28% to $35.9 million in the second quarter. During 2Q/05 the Company purchased $1.36 billion of face-value debt for $23.1 million. Cash collections rose 27% to a record $48.8 million in the quarter. Productivity, as measured by cash collections per hour paid, the Company’s key measure of collector performance, stands at a record $137.02 for the first six months of this year, compared with $117.59 for all of 2004 and $135.62 for the first quarter of 2005. The Company went public in November 2002. For complete details on PRAA’s second quarter results, visit CardData ([www.carddata.com][1]). (CF Library 2/13/03)

[1]: http://www.carddata.com

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Home Capital Equity Plus VISA Portfolio Up 95%

Home Capital Group reported that as of June 30th the gross credit card receivable balance totaled $86.0 million, comprised of $83.2 million, or 96.8% in accounts secured either by cash deposits or residential mortgage collateral, and $2.8 million, or 3.2%
which is unsecured. The total credit approved includes $131.1 million in
secured and $5.7 million in unsecured credit, as compared with $69.9 million in secured and $6.5 million unsecured at June 30, 2004. Home Capital does not accept new unsecured accounts. “Equity Plus VISA” credit cards are secured by a collateral residential mortgage, and this product amounted to $71.2 million of the credit card receivable balance as at June 30th, compared to $55.5 million at year-end 2004 and $36.5 million one-year ago. Cash security deposits on credit card accounts amounted to $20.5 million. For complete details on Home Capital’s second quarter performance visit CardData (www.carddata.com).

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Axalto Card Shipments Up 36%; Tops 110MM

Smart card specialist, Axalto, posted a 15% gain in second quarter revenue, to $260.9 million. The Cards segment revenue amounted to $243.1 million, a 16% increase over 2Q/04. During the period, Axalto delivered more than 110 million microprocessor cards, an increase of 36%, compared to 2Q/04. In financial cards, Axalto’s revenue rose 14% year-over-year to $54.6 million, following a 10% decline in the prior quarter. Axalto says the volumes of microprocessor cards delivered in 2Q/05 posted a steep rise of 17%, with over 20 million cards sold, while the average selling price of microprocessor cards for banking was essentially stable, up 2%. Revenue in the point-of-sale terminals segment advanced by 6%, to $17.7 million. For complete details on Axalto’s second quarter performance, visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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HiCoLoCo Offers CR-80 Cards via the Web

San Diego-based HiCoLoCo has launched the first Web site as a buy-direct portal focused exclusively on the wholesale supply of plastic “CR-80” cards. The website will enable customers in the retail, grocery, health care, casino, hotel and financial industries to price their card project, receive an instant quote and build their card online in real time. Cards are ready to ship in 5-7 working days. The “HiCoLoCo” name is derived from the industry abbreviation “HiCo” and “LoCo” (high and low coercivity) — the terms used to measure the amount of data stored on a plastic card’s magnetic strip.

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PayCard MasterCard Payroll Card Launched

Wisconsin-based USA Paycard has rolled-out its “PayCard MasterCard” prepaid payroll card issued via Genpass Card Systems. This payroll card allows employers to use direct deposit for employees who lack a traditional banking relationship. This translates into lower payroll check processing costs. There are no employer costs to the program and the cards can be used by employees for free using the ‘cash-back’ option at retail POS locations. USA Paycard is a terminal processor in the U.S. driving more than 28,000 ATMs and is the sixth largest switch processor with 360 million transactions annually.

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DNC Forces APACS Outbound Call Shutdown

IL-based APAC Customer Services says it plans to exit virtually all of its outbound customer acquisition business, restructure operations and focus resources on profitable client relationships in a limited number of key industries. The Company has been hard hit by the national “Do Not Call” registry and regulations. For the second quarter, the Company reported a net loss of $5 million on revenue of $58.2 million. Revenue associated with the business the Company plans to exit was approximately $14.3 million for 2Q/05. The Company expects to incur $10 to $15 million in restructuring charges as it closes more than half of its Customer Interaction Centers and eliminates 400 salaried positions which will generate almost $40 million of annualized cost savings. For complete details on APACS second quarter results, visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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ISO IMS Inks a Partnership with FDMS

Illinois-based International Merchant Services has inked a deal to process with First Data and for First Data Merchant Services to provide payment processing and POS equipment leasing services to IMS merchant clients. International Merchant Services Inc. is an electronic merchant bankcard processor. First Data Corp. is a leading provider of electronic commerce and payment solutions for businesses and consumers 4.1 million merchant locations, 1,400 card issuers and millions of consumers worldwide.

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OCC Report Finds an Easing in Retail Credit

The OCC’s eleventh annual “Survey of Credit Underwriting Practices” found for the first time in its history a net easing of retail underwriting standards and that underwriting standards for retail credit products reflected more easing (28%) and less tightening (10%). OCC examiners found that easing of underwriting standards for retail credit was concentrated in real estate secured products such as home equity and first mortgage loans. The 2004 survey included the 71 largest national banks, that have assets of $2 billion or greater and covered the 12-month period ending March 31, 2005. The Office of the Comptroller of the Currency (OCC) was created by Congress.

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Chase Intros the AZ Electronic Payment Card

JPMorgan Chase is currently involved in a state-wide roll-out to provide electronic payment cards for state-administered child support payments in Arizona. This service, which eliminates paper checks, is also being extended on a voluntary basis to unemployment compensation recipients, making Arizona the first state to combine these payments in a single debit card, which can be used for purchases at merchants and at ATMs. The Arizona Electronic Payment Card offers several convenient features to cardholders, including 24-hour access to cash at more than 900,000 ATMs worldwide and the ability to make purchases anywhere the Visa debit logo is displayed. JPMorgan EFS is a leading vendor of government debit card and EBT services with projects in approximately 35 states and territories and is responsible for processing nearly 60,000,000 transactions and handling approximately $2 billion in funds.

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Fair Isaac and IBM Team to Fight Fraud

Fair Isaac and IBM have teamed to help banks combat fraud at an enterprise-wide level. The initiative aligns fraud control systems, strategies and services from IBM and Fair Isaac are designed to assist banks in evolving their fraud management capabilities beyond point solutions that detect traditional forms of fraud at the product level or within a line of business. The new fraud assessment service, which allows banks to maximize their systems and staff investments, follows the recent launch of Fair Isaac’s “Falcon One” system, a new enterprise software solution designed to help banks effectively combat both existing and emerging types of fraud at every point of customer interaction. “Falcon One” platform’s component-oriented architecture takes full advantage of IBM “DB2 Universal Database” and “WebSphere Application Server” capabilities to enable the scalability required for high-volume, high-speed transaction analysis

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