Regulatory Burdens Work Against Consumers

OCC Chief Counsel Julie Williams told a Senate panel yesterday that unnecessary regulatory burden has significant adverse consequences for consumers. She said that over the years, regulatory requirements have accreted, and in the disclosure area, in particular, consumers receive disclosures so voluminous and so technical that many simply don’t read them or when they do, don’t understand them. Williams says unnecessary regulatory burden also can become an issue of competitive viability, particularly for community banks, where bankers face competitors that offer comparable products and services but are not subject to comparable regulatory requirements. She said regulatory burden is an issue that must be confronted on three levels. First, she said, regulators have a responsibility to ensure that regulations are effective to protect safety and soundness, foster the integrity of bank operations and safeguard the interests of consumers. In addition, she said, some regulatory burden initiatives require action by Congress in the form of federal legislation. And finally, she added, it is important to recognize that some regulatory requirements that bankers have highlighted involve requirements set by Congress.

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PayPal SDK for Microsoft ASP.NET Introduced

PayPal has introduced a new software development kit for 2.5 million Microsoft .NET developers worldwide to build secure and cost-effective e-commerce applications that easily integrate with the PayPal platform. Available today as a free download to members of the PayPal Developer Network, the PayPal SDK for Microsoft ASP.NET is compatible with all languages and tools that run on the Microsoft .NET Framework. It includes controls, scripts and sample applications that help developers fully integrate PayPal Website Payments, PayPal’s Instant Payment Notification (IPN) service, and Payment Data Transfer (PDT). PayPal, an eBay Company, enables any individual or business with an email address to securely, easily and quickly send and receive payments online.

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NACHA’s Electronic Check Council Names a VC

NACHA has named John Lucas, currently first VP and head of the electronic services product line for Mellon Global Cash Management, as the Vice Chairman of the Steering Committee of NACHA’s Electronic Check Council. Lucas has spent his entire career in the treasury services industry. He has been instrumental in the design and deployment of the extensive suite of electronic payments solutions at Mellon GCM, a treasury services business of Mellon Financial Corporation. NACHA is the leading organization in developing electronic solutions to improve the payments system.

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Key’s Agent Bank Program Tops 100

Key announced that it now has 100 partners in its agent bank program, offering surcharge-free access to Key’s ATM network. Through Key’s agent bank program, each institution gains access to Key’s ATM network without the significant financial and labor investment required to build, operate and maintain their own individual ATM systems. Institutions can access any or all of Key’s entire network of 2,200 ATMs across the country, including 716 located in ARCO am/pm retail locations along the West coast. KeyCorp is one of the nation’s largest bank-based financial services companies, with assets of approximately $84 billion.

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ADS to Launch a Little Switzerland Card

Dallas-based Alliance Data Systems has inked a five-year agreement to provide an integrated private label credit card program for Little Switzerland at its 22 retail locations in the Caribbean islands, Florida and Alaska. Little Switzerland operates primarily duty-free stores that sell fine jewelry, watches, giftware and other luxury items. Alliance Data Systems is a leading provider of transaction services, credit services and marketing services. Little Switzerland operates luxury retail stores specializing in jewelry, watches, china, crystal and giftware including many famous brand names and designers.

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Charge-Offs Continue to Improve Industry Wide

Credit card charge-offs continue to improve across-the-board, with the “sub-prime” segment improving significantly. Performance among credit card-backed securities in May shows charge-offs for “prime” portfolios dipped 20 basis points from the previous month, while “sub-prime” charge-offs fell 47 basis points. “Prime” charge-offs declined to 6.57%, compared to 6.77% in April, and 6.85% one-year ago. “Sub-Prime” charge-offs declined to 16.69%, compared to 17.16% in the prior month, and 17.32% one-year ago. According to Fitch’s latest credit card index, the 60-or-more-day delinquency ratio for “prime” portfolios fell 12 bps to 3.08%, its lowest level since July 2002, and 46 bps below the year-ago level. Late-stage delinquencies for “sub-prime” portfolios declined for the third straight month to 8.82%, the lowest level since August 2002. Bankruptcy filings reported for the month of May totaled 136,509. Year-to-date bankruptcy filings were 674,075, down 3.1% from the same time last year. Meanwhile, Fitch?s yield index registered its second consecutive monthly decline, sliding 75 bps to 16.21%. However, yield remained 16 bps above the year-ago level. Monthly payment rate fell 55 bps to 16.76% but remained 135 bps above the level a year ago.

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ACS Fires Up its Ultima Debit Cards

Orlando-based ACS has added a bill payment function to its “Ultima Card Twin Access Debit Card Pack” and has inked a joint marketing agreement with EmpaSys. “This greatly increases the ACS merchant base and gives the company the ability to support smaller merchants that do not have credit card terminals to load ACS’ products. For the vast majority of merchants that have credit card terminals, ACS products offer the unique ability to use the merchant’s existing credit card terminal to load its products,” stated Walter H. Roder, president &CEO of ACS Holdings Inc.

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Perfect Storm Produces Soaring Phishing Attacks

A perfect storm has been created for phishing attacks, MasterCard said yesterday at the second annual “Global Risk Management Symposium” in San Diego. The low risk of detection and inadequate law enforcement coupled with the anonymous nature of the Internet, and its relative low cost of distribution, has produced a “hockey stick” like graph of phishing attacks over the past two months. MasterCard said surveillance is the key to suppressing phishing since research has shown there is a period of eight days from the time an account is compromised before it turns into a phishing attack. MasterCard noted that response rates to phishing attacks currently run between 5% and 20%. On Tuesday, MasterCard announced a major partnership with NameProtect to disrupt phishing attacks in real-time.

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Hypercom on a Proverbial Roll this Year

Hypercom says the skyrocketing growth in debit cards, the U.S. move to electronic transactions from paper-based transactions, and smart card growth in Europe and Latin America, is helping to drive its revenues by 10% to 15% this year. Yesterday, the terminal manufacturer’s CEO said Hypercom is on a proverbial roll. This year Hypercom has introduced the “Optimum L4100” compact signature capture card payment terminal; the “Optimum T4100” a high speed card payment terminal using Intel “XScale” technology for smaller merchants; the “Optimum M2100” wireless, hand held terminal; the “IN-tact 1101” a low cost IP gateway device; and, the “S9” PED and EMV certified “Infoguard” tested payment device. Less than two months ago, the global payment technology leader also announced that it has entered the dial and IP POS transaction network business with its new high performance “HBNet” network that gives processors a competitive source for information delivery services. (CF Library 4/14/04)

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The CBL Mall Gift Card is Set to Launch

CBL & Associates Properties and American Express have launched a new “CBL Mall Gift Card. The new CBL Gift Card will be launched this fall in 31 locations (see attached for a list of initial mall participants) and will be available in amounts ranging from $10 to $300. The remaining malls in the CBL portfolio will roll out the program in 2005. CBL & Associates Properties, Inc. is one of the top five owners of shopping centers in North America and the largest owner of malls and shopping centers in the Southeast, ranked by GLA owned. American Express Company is a diversified worldwide travel, network, and financial services provider founded in 1850.

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Your Credit Card Companies Tackle Phishing

Capital One, Chase, Citigroup, Discover Card, MasterCard and MBNA and teamed to form Your Credit Card Companies. The group provides credit resources and a variety of tools that help consumers better understand how credit works, understand and protect their total credit picture and manage debt. Yesterday, the group took on phishing attacks, warning consumers to be alert for e-mail scams. The group’s Web site offers resources for consumers looking for ways to protect themselves against credit card fraud and identity theft. The group recommended that consumers communicate with credit card issuers electronically, using the issuer’s secure online Web site, have an updated anti-virus system and firewall, change passwords regularly, and deal only with companies that post their privacy policies on their Web site.

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[1]: http://www.cardweb.com/images/c/creditcardcompanies/creditcardcompanies.jpg

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