FTC Clips Some Texas Card Spammers

The Federal Trade Commission has reached a settlement with a group of Texas-based Internet scammers and deceptive spammers. The group allegedly sent spam e-mail telling consumers they were approved and guaranteed to receive major, unsecured credit cards with credit limits up to $5,000 for an advance fee of $49.95, which was debited from the consumer’s personal checking account. According to the FTC, however, consumers who paid the fee did not receive the promised card. Instead, they allegedly received access to a set of hyperlinks to companies where consumers could apply for credit cards, and even then those were generally for secured credit cards, stored-value cards, or catalog charge cards. The defendants, ClickForMail.com, Inc., doing business as AllPreApproved.com, and Harvey B. Vaughn, III, agreed to pay $815,000 in consumer redress to settle the FTC charges.

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Hardee’s Signs Processing Deal with NPC

Hardee’s Food Systems has inked a multi-year credit card processing deal with National Processing for all its corporate-owned locations and participating franchise locations. Hardee’s Food Systems, Inc., is a wholly owned subsidiary of CKE Restaurants, Inc., through its subsidiaries, franchisees and licensees, operates over 3,200 restaurants, including 1,000 Carl’s Jr. restaurants, 2,154 Hardee’s restaurants, and 100 La Salsa Fresh Mexican Grills in 44 states and 14 foreign countries. National Processing, Inc. through its wholly owned operating subsidiary, National Processing Company, LLC (R) is a leading provider of merchant credit and debit card processing.

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NACHA Opens 2004 Payment System Awards

NACHA announced yesterday it is accepting nominations for the “2004 George Mitchell Payments System Excellence Award” and the “2004 Kevin O’Brien ACH Quality Award” until December 1st. The George Mitchell Award is presented annually to an individual, company or other organization that has demonstrated superior leadership in the development, implementation or advancement of electronic payments. The Mitchell Award is named in honor of the late George Mitchell, former vice-chairman of the Federal Reserve Board of Governors. The Kevin O’Brien Award is also presented annually to recognize best practices in ACH participants’ efforts to maintain and improve the quality of ACH services and the integrity and reliability of the ACH Network. The award is named in honor of the late Kevin O’Brien, NACHA’s Chairman in 1999-2000. NACHA represents more than 12,000 financial institutions through direct memberships and a network of regional payments associations, and 650 organizations through its industry councils.

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Dining Card Volume Rises, as Vacation Volume Sinks

A processor reports that credit and debit bankcard sales at full-service restaurants increased nearly 20% in a year-over-year comparison between August 2002 and August 2003. Dallas-based Paymentech also reports that the average bankcard ticket price for its restaurant merchants in August was $39, compared with $40 one year ago. The National Restaurant Association’s “Restaurant Industry Forecast” that overall sales (with all forms of payment) at full-service restaurants would only increase by 4.8% this year. Paymentech says it data show consumers are definitely using plastic more to pay for discretionary expenses.

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Australian Merchants Reluctant to Charge Card Users

Since new Australian credit card rules have gone into effect which permit merchants to surcharge customers for using credit cards, only one major corporation has begun surcharging. However, the Reserve Bank of Australia said last week that a growing number of merchants are now surcharging, but the vast majority of Australian merchants do not. Qantas became the first major merchant to implement the surcharge. The airline began assessing a 1% surcharge for tickets booked with a VISA or MasterCard payment card, in July.

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Tripodi Takes Over Allstate Insurance Marketing

Former EVP/Global Marketing for Mastercard, Joseph Tripodi, has been named SVP/Chief Marketing Officer of Allstate Insurance Company. He began his professional career at IBM in 1977 in marketing and later worked at Mobil Oil, Mastercard International, Seagram Spirits & Wine Group and The Bank of New York. The Allstate Corporation is the nation’s largest publicly held personal lines insurer. Allstate provides insurance products to more than 16 million households and has approximately 12,300 exclusive agents and financial specialists in the U.S. and Canada.

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UATP Names Kaiser New President/Chairman

Washington, DC-based Universal Air Travel Plan has named Ralph Kaiser, president and chairman to replace the departing Richard Crum, effective October 15th. Crum is leaving UATP to become president and CEO of Lufthansa AirPlus International’s U.S. division, a UATP account issuer and business travel management company. Before joining UATP, Kaiser developed his international legal and business portfolio at the Overseas Private Investment Corporation and the Export-Import Bank of the U.S. as an advisor to the senior management and Board for both organizations. UATP is the world’s first corporate charge product and is accepted as a form of payment for corporate business travel by nearly 200 airlines worldwide.

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CO-OP Network Lowers Fees for CU Members

Ontario, CA-based CO-OP Network said Monday it has cut support services and switch fees that will save its 1,500 member credit unions an estimated $4.6 million over the next twelve months. In February of this year they announced a price reduction with a $1.3 million annualized impact, in addition to our latest price reduction will have produced a total annualized cost benefit of $5.9 million to CO-OP Network member credit unions in 2003. CO-OP Network provides volume discounts on products and services that include risk management as well as debit and deposit access. With nearly 1,500 credit union members, more than 18,000 surcharge-free ATMs, 70 million monthly transactions and 16 million cardholders, CO-OP Network is the No. 1 credit union ATM network in the U.S. financial services industry.

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Fair Isaac Acquires a Precision Marketing Firm

Fair Isaac has acquired CO-based Seurat Company, a precision marketing outsourcing firm. Seurat Company specializes in Precision Marketing Outsourcing, which addresses a common, critical challenge facing many enterprises. The acquisition of Seurat allows Fair Isaac to deliver a more powerful, robust roster of marketing solutions and services. Seurat’s Precision Marketing approach extends the benefits Fair Isaac delivers through its industry-leading data management and customer analytics solutions to include valuable creative execution services. Fair Isaac Corporation is the preeminent provider of creative analytics that unlock value for people, businesses and industries.

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Internet Banking Services Vary Widely Among Top Banks

Consumers are unable to compare Internet banking services objectively, so says a new report released this week. Nearly 23 million Americans now use online banking, but many are not aware of the wide range of services offered by banks. The research by TowerGroup found that while most top banking sites offer the core features associated with online banking like account history and bill payment, there are significant variations in what these institutions offer to consumers in terms of actual functionality and usability. The top ten sites fell into three categories: leading providers that couple broader levels of features and functions with highly usable interfaces; mid-tier providers that offer capable online sites that lack the range of functionality of the leading sites; and bottom-tier sites that deliver the basics but discernibly lack comprehensive functionality and/or usability. The study looked at many online banking features including EBPP, historical account information, account aggregation, account alerts, document image archive, and customer self-service functionality.

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Charge-Offs and Delinquencies Plateau?

August’s credit card delinquency and charge-off rate, among card backed-securities, edged up ever so slightly, perhaps finally indicating a leveling-off. The charge-off rate for August increased to 6.88%, and the delinquency rate to 5.11%. The figures are based data gathered by Moody’s Investors Service. The charge-off rate increased one basis point while delinquency rose 2 basis points, between July and August.

MONTH CHARGE-OFFS DELINQUENCIES
Apr: 7.00% 5.25%
May: 7.05% 5.20%
Jun: 6.87% 5.12%
Jul: 6.87% 5.09%
Aug: 6.88% 5.11%
Source: Moody’s Investors Service

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Half of Web Users Access Account Information

Internet usage for financial transaction has surged during the past two years, with nearly half of Internet users now conducting financial transactions online. More than two-thirds of this group log on daily to conduct financial transactions, with credit card accounts leading the way. The findings come from the latest issue of “The Consumer Internet Barometer,” which also found that the proportion of consumers logging on primarily to conduct financial transactions has also grown from 3% to 5%. The report found that more than half of Internet users have made a purchase over the past three months, with 30% having spent more than $250. The percentage of consumers expressing satisfaction with their online experience has held steady at around 40% for the past two years, while their overall level of trust has hovered around 26%. “The Consumer Internet Barometer” is produced by NFO WorldGroup, Forrester Research and The Conference Board.

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