ATM Glitch

Nearly 100 customers of Municipal Credit Union in New York City are wanted on charges of ATM fraud. Yesterday, the New York District Attorney confirmed that 65 people have been arrested to-date in connection with fraud that allegedly occurred after the 9/11 attacks. The credit union’s computer system was damaged in the World Trade Center attacks and, in an effort to accommodate members, the normal banking safeguards were relaxed to enable ATM withdrawals. As a result, more than 4,000 members exceeded their bank accounts by more than $1,000. More than 500 overdrew their accounts by $5,000 or more. The District Attorney is prosecuting the most serious cases.

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TSYS Canada

TSYS has signed a 10-year outsourcing agreement with CIBC to process more than 5 million VISA accounts in Canada. CIBC will become one of the Company’s 10 largest processing clients. In an earlier agreement, TSYS announced in January that it would process the new “entourage” line of American Express products for CIBC, including Canada’s first nationwide smart card. TSYS has supported other CIBC card products since 1994. TSYS has processed card accounts in Canada since 1989. When the transition is complete, TSYS will be North America’s only third-party processor servicing VISA and American Express accounts for one bank on a single payments platform.

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Goya Picks IDT

NJ-based IDT Corporation has been selected as the exclusive prepaid calling card provider by Goya Foods for its “Stay in Touch with the Family” program. As part of the program a 25-minute pre-paid calling card powered by IDT will be included with the purchase of specially marked 3-packs of Goya Rice Mix at participating retailers. The card will provide both English and Spanish dialing instructions and can be used in the United States to make calls to anywhere in the U. S. and Puerto Rico. The card can be used to call other international locations, but since rates vary the number of minutes of call time might vary as well.

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Chitwood & Harley Target COF

Atlanta-based Chitwood & Harley has filed a class action shareholder lawsuit against Capital One. The complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and SEC Rule 10b-5, by issuing a series of materially false and misleading statements relating to the nature of Capital One’s business operations, which caused Capital One’s stock price to become artificially inflated.

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PayPal Operations

PayPal announced this morning plans to build a state-of-the-art customer service and operations facility in La Vista, Nebraska. The new building, scheduled to be completed in early 2003, will total 115,200 square feet and accommodate up to 1200 people. The entire building will be constructed primarily of glass panels that admit natural light without heat gain or computer glare. The site also has enough space for a second building with similar square footage to accommodate PayPal’s future growth. The new facility will consolidate PayPal’s current 540 employees from two buildings in Omaha. At mid-year, PayPal had 17.8 million member accounts, including 3.7 million business accounts. More than $3 billion was sent through the PayPal network in the first half of 2002.

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Fair Isaac Board

In conjunction with the closing of the merger between Fair, Isaac and HNC, the company announced Monday the appointment of two HNC directors to Fair, Isaac’s board of directors. Fair, Isaac’s board now totals nine members. The new board members include Alex “Pete” Hart, who has been an HNC director since October 1998. Currently, Hart is an independent consultant to the consumer financial services industry specializing in emerging payment and distribution systems within the consumer banking industry. Hart previously served as CEO of Advanta and as president and CEO of MasterCard International. He also serves on the boards of Sachez Computer Associates, Global Payments, Actrade Financial Technologies, and Silicon Valley Bank, as well as a number of privately held companies. Fair, Isaac also announced that Thomas Farb will join the board. He is general partner and CFO for the Boston office of Summit Partners, one of the country’s largest investment firms.

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Citi Affinity Cards

Citibank announced this morning that its Affinity & Agent Bank division has extended its credit card portfolio marketing agreements with Intuit and the American Bar Association through the next several years. The American Bar Association is the largest voluntary professional membership association in the world and has more than 400,000 members. Today, over 120,000 lawyers carry the Citibank ABA card in their wallets. Citigroup’s cards division now serves 108 million accounts in 47 countries. Second quarter domestic charge volume was $62.0 billion according to CardData ([www.carddata.com][1]).

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

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ePIN+

Experian launched a sophisticated Web-enabled data analysis solution that helps collections organizations reduce expenses and improve operations by tracking the location of payments and statements in the postal system. The “ePIN+” system utilizes the latest United States Postal Service tracking technology to give users precise information about any mail piece. It provides the date customers receive billing statements and when their payments have entered the postal system. Information gathered through “ePIN+” can be seamlessly integrated with a user’s predictive dialing capability providing relevant information on the status of the mailed invoice or returned envelope for the debtor with whom they are speaking.

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ActivCard 2Q/02

ActivCard reported 2Q/02 revenue of $9.6 million, an increase of 18% over the $8.2 million reported in the first quarter and a year-over-year increase of 13% from the second quarter of 2001. For the third quarter of 2002, the Company anticipates continued sequential growth with revenues ranging between $10.0 million and $11.0 million. Actual GAAP net loss for the third quarter is expected to range between $0.07 and $0.11 per share.

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GEMPLUS LAWSUIT

After being tied-up in appeals for three years, Gemplus has reportedly been ordered to pay damages to a small California firm. In February 1999, a federal court jury in San Diego awarded $17.5 million in damages to Humetrix, Inc. in a breach of contract and breach of partnership action against Gemplus, S.C.A.. The jury ruled that Gemplus’ actions caused a $15 million loss in potential profits for Humetrix. The jury also awarded $2.5 million in additional damages. The French newspaper Les Echos reported the appeals process has ended. The dispute centered over a 1995 agreement in which Gemplus agreed to a five-year contract designating Humetrix as a reseller of health-care applications of Gemplus smart card products in the U.S.. The contract also provided Humetrix with royalties for 10 years. Humetrix was in the process of developing ‘VaccicardT’, a smart card to track immunization records for infants, in the U.S., as well as other health care applications, when Gemplus allegedly breached its contract and partnership with Humetrix. Humetrix also filed a claim seeking priority trademark rights over the trademark “VaccicardT.” The jury awarded Humetrix with ownership of the trademark, but Humetrix made no claim of monetary damages on that count.

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COLES MYER CARD

Coles Myer Ltd is reportedly in final discussions to issue a co-branded VISA and MasterCard. The retailer currently has about two million cardholders in its private label card program. It will attempt to upgrade 350,000 store card customers to a VISA or MasterCard, according to the Australian Financial Review. GE will issue the card for Coles Myer. Last year, Coles Myer launched the new ‘Coles Myer Card’ to replace more than 1.7 million existing Myer, Grace Bros, Target and Kmart private label credit cards now in force in Australia.

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