Diners Club & Office Depot

Diners Club has signed Office Depot to accept the family of Diners Club Cards at its more than 850 retail stores in North America and is offering double “Club Rewards” points on every Office Depot purchase charged to Diners Club through Sept. 30. Office Depot, Inc., founded in 1986, is the world’s largest seller of office products and an industry leader in every distribution channel, including stores, direct mail, contract delivery, the Internet and business-to-business electronic commerce, operating more than 850 office supply superstores in the United States and Canada.

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Benny Card

Flex-Plan Services, a WA-based third party administrator, has contracted with Evolution Health to offer the “Benny Card,” a stored-value, special purpose MasterCard Card that facilitates access to flexible spending accounts. The regional TPA will first offer the “Benny Card” to its own employees and then to its top clients, which include The Fred Hutchinson Cancer Research Center, Seattle School District, City Of Everett and Murray Franklin Corporation. The contract, which took effect in May, represents one more in an ever-expanding list of national and regional TPAs who have agreed to offer the “Benny Card” to their clients, representing more than 2.2 million FSAs. The “Benny Card” was officially launched by Evolution Benefits, a division of Evolution Health, on January 1st of this year, with a Fortune 500 utility company, among others. It also implemented on July 1, 2002 the nation’s first combined FSA and health reimbursement account powered by the Benny Card with Humana Inc., a top-10 health plan based in Louisville, KY. Evolution Health’s Benny Card partners include MasterCard, WildCard Systems, BANKFIRST, Advance PCS, Merck-Medco and Express Scripts.

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ACTIVCARD 2Q/02

ActivCard reported revenue for the second quarter of $9.6 million, an increase of 18% over the $8.2 million reported in the first quarter of 2002 and a year-over-year increase of 13% from the second quarter
of 2001. Net loss for the quarter was $4.7 million, compared to a net loss of $2.7 million in the second quarter of the prior year. For the third quarter, the company anticipates continued sequential growth with revenues ranging between $10.0 million and $11.0 million.

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FARGO DEAL

Mexico City-based Latin ID has been named by Fargo Electronics as its import supplier for Mexico. Latin ID joins Ifo Identiformas s.a. de C.V. and Identicod (Sistemas de identificacion Automatica, S.C.) to form the largest ID card printer distribution company in Mexico. Latin ID will specialize in government projects and business-to-business distribution sales. Latin ID will move into new offices in Mexico City in September. Minnesota-based Fargo is the only manufacturer to offer three distinct technologies in printing systems – “High Definition Printing,” traditional “Direct-to-Card” printing, and “CardJet Printing Technology” – to personalize plastic identification cards, complete with digital images and text, lamination, and electronically encoded information.

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GAMBLING BAN IMPACT

London-based WildlifeWins.com says the American ban on credit card transactions for online gambling is putting a damper on what could be significant funding in poorer regions of the world including Africa and Asia. When you visit WildlifeWins.com you have two options, you can either buy a
bingo, scratch card or lottery ticket that gives you the chance to win up to $20 million, or you can make a donation directly to the aid of the animals you
wish to preserve. However, with online credit card transactions related to gaming being negatively coded by major US credit card issuers, even cards
registering to make direct donations are being rejected.

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Card Pulse

More data confirming favorable credit card portfolio trends this summer: bank credit card charge-off rates are improving and most issuers are now reporting lower 60-day+ and 90-day+ delinquencies. Last week, RAM Research Group reported that charge-offs and delinquency among all card outstandings declined during June to 6.44% and 5.52% respectively. This week Standard & Poor’s reports that charge-offs and delinquency among credit card-backed securities declined 25 bps in June to 6.9% and that more than 60% of the trusts that make up its ABS credit card index reported lower 60-day-plus and 90-day-plus delinquencies.

STANDARD & POOR’S CREDIT CARD QUALITY INDEXES
Performance month Jun 00 Jun 01 Apr 02 May 02 Jun 02
Yield (%) 19.4 19.3 18.4 18.6 17.9
Charge-offs (%) 5.3 6.5 7.4 7.1 6.9
Delinquencies (%) 4.1 4.9 5.2 5.0 5.1
Payment rate (%) 16.6 15.9 15.6 16.4 15.2
Source: Standard & Poor’s

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SMART CARD MANAGEMENT

Cassis International and MasterCard International signed a MOU to offer the first smart card management services in South East Asia. For card issuers, Cassis provides the secure platform to share services and outsource their non-core IT activities thus relieving them of the need to install and maintain expensive infrastructure required for chip implementation. This suite of services will promote speed to
market, alleviate ongoing operational costs, resulting in low implementation costs. Currently, MasterCard is supporting 130 chip migration projects globally. Over the past few months MasterCard has carried out several programmes to accelerate the migration of chip in Malaysia. In April this year, MasterCard International launched “OneSMART MasterCard,” a comprehensive approach to smart cards designed to give MasterCard’s member financial institutions around the world the technology choices, marketing support and critical flexibility they need to succeed.

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TU Fights Credit Repair Fraud

TransUnion this morning announced that it is making available a fact sheet that provides consumers with guidance in effectively managing their individual credit reputation. It contains tips on how consumers can effectively monitor and manage their own individual credit reports so that there are no `surprises’ when they want to get the loans they need, the car they want, or the home of their dreams. This consumer education fact sheet is available on-line at TransUnion’s Web site.

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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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