CHIP & PIN

A new payment card program, that combines a smart card with a PIN to fight fraud, went live yesterday in Britain. The “Chip and Pin Programme” pilot in Northampton involves more than 1,000 retailers and 150,000 cardholders. It is the first pilot of the new technology in the country, although France has used a similar system for several years. Over the next eighteen months the project is expected to include 850,000 retailer terminals, 120 million cards, 40,000 ATMs, and 40 million cardholders. By 2005, the liability of fraud at the POS will shift to retailers from issuers as a result of the upgrade to EMV/PIN. APACS says payment card fraud in the UK hit about US$750 million last year with counterfeiting making up approximately $250 million of the total.

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Chip & PIN

A new payment card program, that combines a smart card with a PIN to fight fraud, went live yesterday in Britain. The “Chip and Pin Programme” pilot in Northampton involves more than 1,000 retailers and 150,000 cardholders. It is the first pilot of the new technology in the country, although France has used a similar system for several years. Over the next eighteen months the project is expected to include 850,000 retailer terminals, 120 million cards, 40,000 ATMs, and 40 million cardholders. By 2005, the liability of fraud at the POS will shift to retailers from issuers as a result of the upgrade to EMV/PIN. APACS says payment card fraud in the UK hit about US$750 million last year with counterfeiting making up approximately $250 million of the total.

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eStorebuilder

Moneris Solutions, a joint venture of the Royal Bank of Canada and the Bank of Montreal, and GLS Global Assets Ltd. have teamed to launch an e-commerce solution for North American Web merchants. The companies also announced that Ophthalworld.com has inked a deal to enable its ophthalmology clients to obtain a merchant account from Moneris to accept credit card payments from their patients. The combination of the GLS “eStorebuilder 5.0,” and Moneris Solutions’ merchant account services provides an off the shelf or online solution for Web merchants to accept credit cards online without the need of a programmer. Moneris Solutions uses SSL 128-bit encryption for Web transactions.

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Laptop Incentive

WI-based Universal Savings Bank has launched a VISA credit card program offering a free HP laptop as an incentive for transferring at least a $5,000 balance from another credit card. The savings bank, which specializes in home equity loans, says it will launch a direct mail, Web-based campaign over the next year to market the promotion to more than 14 million households nationwide. The “Universal Savings Bank Platinum VISA” credit card will offer a free “Compaq Evo N1015v” notebook PC. The offer will only be available to consumers with excellent credit ratings and by invitation or pre-approved offer. The”Compaq Evo N1015v” sells for about $800 retail.

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Datacard Skimming Fighter

Datacard Group has introduced the “Magneprint” module for the “9000” and “7000” series card issuance systems which records a unique fingerprint or noise signature from each magnetic stripe during the card personalization process to help fight skimming. Datacard is collaborating with MagTek, Inc., a leading card reading solutions supplier and provider of Magneprint technology.

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Online Purchases

A new study has found that consumers would be more motivated to shop online if they were guaranteed they would not receive unwanted e-mails as a result of purchases. The study has found that consumers would also be more motivated if there was an extra layer of security for credit card transactions. The “MasterCard Internet Consumer Segmentation Research” found that 73% of the 1,000 study participants agreed that enhanced security features would influence their decision to purchase online in the next three months. Sixty-one percent of respondents are concerned that their credit card number will be intercepted by hackers.

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RBA RULES

VISA began its appeal today to the Australian Federal Court over new credit card rules issued by the Reserve Bank of Australia last year that became effective this year. VISA believes the RBA went beyond its legislative powers in calling VISA a “designated payments system” under the “Payments Systems Act.” VISA also says the RBA has inappropriately interfered with its relationships with bank, merchants, and cardholders. VISA says that VisaNet is not a payments system because it does not actually transfer funds, merely facilitating approvals for credit card transactions. Last year, the RBA issued new reforms on the credit card business permitting merchants to recover from cardholders the costs of accepting credit cards. The new standard went into effect January 1st. Also under the new RBA rules, interchange fees will decrease from around 95 basis points to approximately 55-60 basis points by July 1st. VISA and MasterCard argue that the RBA hasn’t complied with its obligations under the “Payment Systems Act,” and that the proposed changes don’t meet the public-interest test required under the act. MasterCard is expected to make its opening statement on Wednesday. Representing VISA is Freehills and representing MasterCard is Coudert Brothers.

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Check Collections

The FTC has sued three NJ-based corporate defendants and their principals to halt an alleged nationwide scheme to extract millions of dollars from consumers by falsely threatening them with arrest and prosecution unless consumers immediately pay them amounts that the consumers do not owe. The complaint also charges the defendants with misrepresenting the amount of the debt when they added extra charges without telling consumers. In addition, the defendants allegedly failed to inform consumers of their right to receive more information about the debt or to dispute the defendants’ claims prior to payment. The three corporate defendants include National Check Control, Check Enforcement, and Goldman & Co.

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