The IRS Renews OPC for Another Year

The IRS has renewed its contract with the Official Payments for an additional one-year period, the second of four optional one-year contract renewals. This contract allows Official Payments to continue collecting and processing individual federal income tax payments for the IRS. Enhancements to Official Payments’ service in conjunction with this contract renewal include expanding the tax years for which past due payments may be accepted. Under this contract renewal, Official Payments will be able to accept Prior Tax Years’ payments for 1999 through 2003 beginning January 1, 2005 and Installment Agreement payments for tax years 1999 through 2004 beginning January 1, 2005. Tier is a provider of transaction processing and packaged software and systems integration services for public-sector clients.

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Bank One Card Brand to Fade Away

J.P. Morgan Chase and Bank One have decided that its U.S. consumer and commercial banking businesses will operate under the “Chase” brand. Preparations for migration to the new brand have begun, with changes planned to begin to appear first in credit cards. The companies expect to begin changing bank branches on a state-by-state basis in early 2005. The companies said fact-based research has shown the Chase brand is stronger in all parts of our consumer and commercial banking businesses. When the merger was announced earlier this year, the companies said the Investment Banking and Asset & Wealth Management businesses will operate under the “JPMorgan” brand. The holding company name will continue to be known as J.P. Morgan Chase & Co. The Chase-branded retail and commercial banking businesses will be headquartered in Chicago; the card business will be headquartered in Delaware. The JPMorgan-branded businesses and the parent company, J.P. Morgan Chase & Co., will continue to be headquartered in New York.

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Cards Face Rising Home Equity Loans

While growth in credit card loans remains sluggish, home equity is set for a banner year. LendingTree say a survey it conducted found that a projected 23.5% of respondents will have secured a home equity loan this year, double the number who did so in 2003. For comparison, 11.7% secured home equity loans in 2003, 6.7% in 2002, and 5.5% in 2001. The most popular uses for home equity loans were home improvement at 38.1%, debt consolidation at 31.9%, home purchase at 4.6%, auto purchase at 4.3%, college tuition at 2.9%, and small business expenses at 2.2%. More than 44% of respondents used the Internet for financial/consumer transactions, and 71.3% of them cite convenience and speed as the primary benefit of using the Internet.

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SciQuest to use GE’s vPayment

NC-based SciQuest announced plans to integrate GE Corporate Payment Services’ “vPayment” with its procurement automation solution. vPayment uses patented technology to pay suppliers via a MasterCard(R) account number that has specific dollar- and date-range controls. When integrated with an online buying tool such as SciQuest’s, vPayment automatically appends accounting information to the MasterCard transaction record. GE Corporate Payment Services, the corporate card unit of GE Consumer Finance, develops and markets corporate bank cards and e-settlement tools designed for small-, medium- and large-sized companies and organizations.

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MC PRESIDENT

MasterCard officially named Kevin Stanton as president of MasterCard Canada. He has served as interim president of MasterCard Canada for the past two months. Prior to being named interim president, Stanton was SVP/Strategy and Market Development of MasterCard Canada. Previously, he spent seven years as VP/Senior Counsel and North America region counsel at MasterCard International. MasterCard’s gross dollar volume for credit cards and off-line debit cards rose more than 15% in Canada during the first quarter to $1.9 billion. MasterCard has 27.1 million cardholders in Canada linked to 20.8 million accounts.

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FSV Payment Systems on VISA’s CISP

FSV Payment Systems has been added to VISA USA’s list of “Cardholder Information Security Program” compliant service providers. The Cardholder Information Security Program establishes a set of twelve industry-wide requirements designed to protect sensitive information. Being added to Visa’s list of CISP compliant service providers demonstrates FSV’s commitment to protecting the confidentiality and integrity of cardholder data and personal data used to make purchases from merchants using the FSV payment gateway. FSV Payment Systems offers a robust suite of unique, host-based stored-value and payroll debit card solutions direct to large employers and to financial institutions through an exclusive agreement with Fiserv Inc..

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AmeriDebt Seeks Bankruptcy Protection

Debt counselor, AmeriDebt, has filed for Chapter 11 bankruptcy protection. AmeriDebt announced in November it had stopped enrolling new consumer clients. The agency suspended all television, radio and Internet outreach aimed at attracting new consumer clients. AmeriDebt says payments made by consumers are processed through a separate trust account that will not be affected by this filing, and both past and future payments will continue to be disbursed to creditors on a timely basis. In November, the Federal Trade Commission filed a lawsuit against MD-based AmeriDebt, DebtWorks, and its founders, for misrepresentation of their non-profit status and for deceptive business practices. The FTC charged that the credit-counseling service is setup to make money for affiliated for-profit companies and individuals, rather than operating for charitable purposes. The FTC also alleges that the defendants charged an up-front fee to consumers enrolling in a debt management plan, despite claims to the contrary in their advertising. The FTC also reached a settlement with Ballenger Group in November for its role in the AmeriDebt operation. Ballenger acted as the servicer for AmeriDebt’s DMPs since the beginning of this year. (CF Library 11/20/03)

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CyberSource Offers AmEx IDES

CyberSource is offering the new Internet fraud screen capabilities at American Express. Goals of the new program — reduced fraud, fewer chargebacks, and less manual intervention by merchants — all aimed at increasing merchant confidence and offering the cardholder a better experience. Merchants who choose CyberSource’s direct connection to American Express have access to a variety of American Express fraud prevention tools, including Automated Address Verification (AAV), which verifies the address on purchaser’s card is the same as the ship-to address, Enhanced AAV (which adds last name validation), and Automated Address Verification Plus (AAV+). CyberSource Corporation is a leading provider of electronic payment and risk management solutions. CyberSource solutions enable electronic payment processing for Web, call center/IVR, and POS environments and manage fraud risk associated with card-not-present transactions.

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Providian Settles Shareholder Lawsuit

Providian Financial has reached a settlement in a 2001 shareholder class action lawsuit for $65 million. Providian Financial is a leading provider of credit cards to mainstream American customers throughout the U.S. By combining experience, analysis, technology and outstanding customer service, Providian seeks to build long-lasting relationships with its customers by providing products and services that meet their evolving financial needs.

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Vital Hires Brown for Client Relations

Vital Processing Services has hired Angela Brown, formerly with VISA USA, as EVP/Client Relations and Business Development. Brown most recently served as executive vice president of Visa U.S.A.’s Acceptance division and represented Visa on Vital’s Board of Directors. In her role at Visa, Brown created an enhanced focus on the acceptance community and introduced key products and services addressing the specific needs of Visa’s acquirer, processor and merchant constituents. Vital Processing Services is a leader in technology-based commerce enabling services. Vital delivers comprehensive, end-to-end payment solutions to acquirers and their merchants to reliably process millions of credit, debit and other card transactions every day.

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Centralized Source for CRA Reports Coming

The FTC issued its final rule regarding free annual credit reports under the “Fair and Accurate Credit Transactions Act” and the “Fair Credit Reporting Act.” “FACTA,” which was enacted on December 4, 2003, amends the FCRA and requires, among other things, that the three nationwide consumer reporting agencies provide to consumers, upon request, a free copy of their credit report once every 12 months. Under the final rule, the nationwide CRAs must establish a “centralized source” for accepting consumer requests for free credit reports (called annual file disclosures in the final rule). This centralized source must include a dedicated Internet Web site, a toll-free telephone number, and a postal address. In addition, like the proposed rule, the final rule provides nationwide CRAs with relief from the capacity requirements of the final rule during times of unusually heavy request volume. The final rule also limits the use and disclosure of personally identifiable information collected through the centralized source. In addition, the final rule requires nationwide specialty CRAs to maintain a toll-free telephone number through which consumers may request a free copy of their credit report once every 12 months.

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