Elan Renews NH Bank

Elan Financial Services has renewed its contract with Laconia Savings Bank in Laconia, N.H., to provide a wide range of financial services for five years. Laconia Savings Bank, with $650 million in assets, has been with Elan since 1989.

Elan Financial Services will drive Laconia Savings Bank’s 22 ATMs and process its customers’ electronic funds transfer (EFT) transactions and Master Card transactions. Elan will also provide fraud management reporting and alerts through its FraudWatch product. FraudWatch detects fraud as the debit card transaction is occurring, thereby preventing financial loss to the institution and reducing cardholder disputes.

Elan Financial Services supports more than 10,000 ATMs, and 12 million cards, for 3,000 financial institutions with a complete range of products and services including credit card issuing, ATM, debit card, and merchant processing. Elan provides full-service support and management tools that are offered uniquely through a single source.

Elan is part of Minneapolis-based U.S. Bancorp (NYSE:USB). With assets in excess of $171 billion, U.S. Bancorp is the 8th largest financial services holding company in the United States and operates the third largest bank-owned ATM network. Visit U.S. Bancorp on the web at [www.usbank.com][1].

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


DSTC & Identrus

Zions Bancorporation and Identrus, LLC announced that they have entered into a definitive agreement under which Zions’ affiliate Digital Signature Trust Co. will be acquired by and merge into Identrus.

Under terms of the agreement, Zions will maintain an ownership in Identrus of approximately 33 percent in exchange for DST. Zions will also have representation on the Identrus board, with two positions that it expects to be filled by Doyle Arnold, Zions Bancorporation chief financial officer, and Donald Ogilvie, executive vice president of the American Bankers Association (“ABA”). The ABA is a minority owner in DST and will maintain a small ownership in Identrus. The merger is expected to be completed in the second quarter of this year. Other financial terms of the agreement have not been released.

The name of the combined company will be Identrus, with headquarters located in New York City and significant operations in Salt Lake City. Sales offices will be located in London and Washington, D.C.

Harris Simmons, president and CEO of Zions, stated, “This merger allows Zions to maintain its position of leadership in providing trust solutions to the world of e-commerce. Financial institutions have a long tradition of trust with their customers, and we continue to believe they are the best source for issuing digital certificates to their business and retail customers.”

“This merger marks an alignment of the U.S. and global digital ID efforts for our industry,” said Donald G. Ogilvie, ABA executive vice president. The ABA manages the policy and rules for the TrustID program. “The ABA has developed standards for the U.S. financial services community for more than 125 years, and our sponsorship of the TrustID program was a logical step in establishing banks as the authentication authority for financial tractions. Bringing together TrustID with Identrus will strengthen the banking community’s competitive edge worldwide.”

**About Identrus**

Identrus, LLC is the global leader in robust digital trust services that enable financial institutions, governments and businesses to conduct secure electronic commerce, communications and collaboration. Identrus is the system operator for its hierarchy of participant financial institutions, which issue digital certificates to their business customers. The company’s core offerings are strong authentication and enhanced e-payment initiation services, powered by its globally interoperable technical and legal infrastructure. Approximately 60 of the world’s leading financial institutions spanning 133 countries participate in the growing Identrus Global Trust Network. Additional information about the company is available at .

**About the American Bankers Association**

The American Bankers Association brings together all categories of banking institutions to best represent the interests of this rapidly changing industry. Its membership — which includes community, regional and money center banks and bank holding companies, as well as savings associations, trust companies and savings banks — makes ABA the largest bank trade association in the country. ABA can be found on the Internet at .

**About Zions Bancorporation**

Zions Bancorporation is one of the nation’s premier financial services companies, consisting of a collection of great banks in select high growth markets. Under local management teams and community identities, Zions operates over 400 full-service banking offices in Arizona, California, Colorado, Idaho, Nevada, New Mexico, Utah and Washington. In addition, Zions is the only primary dealer in government securities headquartered in the western United States, and is a national leader in SBA lending, public finance advisory services, agricultural finance and electronic bond trading. The company is included in the S&P 500 Index. Investor information and links to subsidiary banks can be accessed at .


IRS Probe

The IRS said yesterday it has received account records on nearly 250,000 MasterCard accounts issued by banks in tax haven countries to U.S. residents, and has gone to court to expand the probe into VISA account records. American Express is expected to turn over its account records any day after the IRS filed papers yesterday in Miami federal court. The IRS also filed papers Monday in San Francisco federal court to require VISA to turn over account records on offshore accounts used by U.S. taxpayers. The government has been negotiating for months with AmEx and MasterCard to gain access to records of suspected tax evaders who pay bills through banks in the Cayman Islands, Bahamas, Antigua, Barbuda, and 26 other countries The IRS says it believes upwards of two million taxpayers have set up phony corporations to open a bank account in an offshore tax haven. Using a credit or debit card linked to the account to make purchases in the USA, the taxpayer funds the account with unreported income. The IRS went to court in 2000 to force the credit card companies to hand over the account records for 1998 and 1999. In October 2000, U.S. District Judge Adalberto Jordan permitted the IRS to issue summonses for charge, debit, and credit cards issued by or paid by banks in the Bahamas, the Cayman Islands and the country of Antigua. (CF Library 10/31/00; 3/8/02)


iDine Deal

Miami-based iDine Rewards Network this morning announced an agreement with America Online to jointly develop a new dining benefits program for AOL members. iDine offers its members a variety of dining savings and rewards programs at more than 7,500 restaurants throughout the USA via means of a registered credit card platform. The Company currently has 11 million registered credit cards through 8.4 million enrolled accounts. Under the AOL deal, members will earn credit toward AOL service for every $200 in dining spend at iDine’s network of restaurants nationwide. The new dining program is scheduled to launch in the spring of 2002.


Consumer Confidence

The Conference Board’s Consumer Confidence Index, after a small dip in February, surged in March. The Index climbed to 110.2 (1985=100), up from 95.0 in February. Consumers’ appraisal of current conditions improved significantly in March. Those rating business conditions as “good” increased from 17.6 to 20.7 percent. Consumers rating current business conditions as “bad” dropped from 22.8 percent 18.1 percent. Consumers reporting jobs were “plentiful” rose from 18.2 percent to 20.6 percent. Those claiming jobs were “hard to get” fell from 22.6 percent to 20.8 percent. The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.


EDS & WesPay

EDS, and the Western Payments Alliance, one of the nation’s largest payments organizations, announced the launch of the country’s first digital image check truncation service as part of the financial services industry’s drive towards more secure, technology-based check processing.

The new service, designed and developed by Zions Bancorporation (Nasdaq: ZION) and licensed exclusively by EDS, moves digital images, rather than paper. The service allows financial institutions to save time, lower expenses, reduce fraud, and eliminate delays arising from any disruption to the nation’s transportation system. WesPay member institutions Union Bank of California (NYSE: UB), Zions Bank, First Hawaiian Bank, Nevada State Bank, California Bank & Trust, California Federal Bank, and WesCorp, the nation’s largest corporate credit union, are among the first to implement the new service.

“Financial institutions, businesses and consumers are all less vulnerable using digital image check technology,” said Gerard F. Milano, chief executive officer of the Western Payments Alliance. “It is a better way to handle checks, whether it’s in peacetime or during a period of duress. Digital image check truncation is the next critical step in transforming the nation’s check processing system, and it’s particularly important in the aftermath of September 11th.”

**Converting Paper Checks into Digital Images**

The new service helps financial institutions convert paper checks into digital images for processing by passing the digital image or a “substitute check” to the receiving financial institution. Today, financial institutions incur significant expense and time delays in the physical movement of checks by ground and air transportation. The drawbacks of conventional transportation came sharply into focus in the wake of the September 11th tragedy, when federal authorities shut down the nation’s air transportation system.

WesPay, one of the nation’s largest regional payments associations with more than 1,100 members in the western U.S. and Pacific region, handled 1.8 billion checks last year in the western states. It can take up to three days to collect and transport checks at institutions in outlying parts of WesPay’s large geographic service area. In the wake of September 11th, check collection and settlement for some WesPay members was delayed by up to a week. In the western U.S., digital image check truncation can lessen the effects of distances between financial centers.

WesPay has taken a lead role in accelerating the use of digital image check technology by introducing the new service among its member financial institutions in the western U.S. The roll out is designed to test the processing infrastructure of the service. The first phase of the rollout, which began in February, has functioned daily with images of actual returned checks. In the next stage, participating institutions will consider transit check collections.

“This system, designed and developed by Zions Bank and licensed exclusively to EDS, is an important breakthrough and innovative solution that is likely to become the national standard for the financial industry,” said James Pitts, director of EDS Payment Services. “Backed by the resources of EDS, we plan to aggressively roll out this system to other regional associations over the next 12 months.”

**Federal Legislation Key to Success**

To promote widespread adoption of digital image check truncation, the Federal Reserve has proposed legislation known as the Check Truncation Act to remove existing legal barriers to check truncation. The legislation would effectively allow the truncation of any check to a legal paper check by using digital imaging. Today, digital image check truncation can occur only when the owner of the check authorizes it. The Check Truncation Act would eliminate this authorization requirement and broaden the potential use of digital image checks in settlement processing. The anticipated passage of the legislation is likely to lead to rapid implementation of digital image check truncation technology.

“The Federal Reserve’s proposed legislation allowing electronic presentment of checks will be a watershed for the country’s financial system and should increase profitability for every financial institution,” Milano said. “With almost 50 billion checks written annually in the U.S., the savings and efficiencies from digital image check truncation will be truly extraordinary.”

**About WesPay**

The Western Payments Alliance is one of the nation’s largest regional payment associations, with more than 1,100 members in the western U.S. and Pacific region. The Western Payments Alliance serves as a cooperative, non- profit organization enabling member financial institutions to efficiently process paper-based and electronic financial transactions. Each day, WesPay collects and clears more than seven million checks totaling $7 billion in value. As a NACHA member, the Western Payments Alliance also acts as the rulemaking authority governing member transactions flowing through the Automated Clearing House (ACH). For more information, call 415-433-1230, or visit .

**About EDS**

EDS, the leading global services company, provides strategy, implementation and hosting for clients managing the business and technology complexities of the digital economy. EDS brings together the world’s best technologies to address critical client business imperatives. It helps clients eliminate boundaries, collaborate in new ways, establish their customers’ trust and continuously seek improvement. EDS, with its management- consulting subsidiary, A.T. Kearney, serves the world’s leading companies and governments in 60 countries. EDS reported revenues of $21.5 billion in 2001. The company’s stock is traded on the New York Stock Exchange and the London Stock Exchange. Learn more at .


Debt Counseling

A three-year study on the change in consumer financial behavior after receiving credit counseling services, revealed that consumer credit usage and payment behavior were impacted in a positive way from such counseling. The analysis of 14,000 consumers examined ten different measures of borrower behavior subsequent to counseling and found that borrowers who received this form of budget/financial counseling reduced their debt and improved their credit profile over three subsequent years, compared to similar borrowers who did not receive counseling. The study was conducted by Georgetown University Credit Research Center and Lundquist Consulting under the blessing of the National Foundation for Credit Counseling and its members. TransUnion provided the measure of credit performance over the three-year period, from June 1997 to June 2000. The clients studied were those counseled by NFCC agencies who received a comprehensive budget review and written action plan. The clients included in the study were not on “Debt Management Plans,” where agencies actively intervene with creditors to negotiate client payment plans that can include reduced minimum payments, reduced interest rates, and lower fees. While agencies and creditors closely track the progress of individuals on DMPs, no known information heretofore has existed on the impact of clients who receive budget/financial management counseling only. On average, one-third of NFCC agencies’ clients counseled are recommended for DMPs. The other two-thirds typically need a budget review and an understanding of options available, financial education, and possibly referral to other social service organizations to address other specific underlying problems affecting families’ financial well-being. NFCC’s 155 members are located in more than 1,300 communities nationwide and are mostly known as Consumer Credit Counseling Services, although some members are known by other names. In the year 2000, NFCC member agencies were contacted by more than 1.5 million American families under financial pressure.


Providian Rebound

The likelihood that Providian might go under are just about nil, according to a consensus of opinions among analysts. Providian’s stock took a nearly 16% leap Friday to close at more than $7 per share, after the company made another positive announcement. The Company indicated last week that it had reached a settlement in regard to a class-action shareholder lawsuit. Under terms of the proposed settlement, Providian will pay $38 million, the proceeds of which will come from insurance. The settlement was presented to a federal judge in Philadelphia on Friday. The original lawsuit was filed in 1999 by shareholder litigation specialist Wolf Popper. The complaint alleged that Providian improperly obtained revenues, and misrepresented the source of its revenues and income in public filings and press releases. The suit charged Providian with intentionally failing to post credit card payments on time in order to enable Providian to improperly record as revenues late fees and penalties, improperly enrolling new credit card customers without their permission, and improperly charging credit card customers for Providian’s fee-based products not requested. Last week’s settlement comes on the heels of other positive financial news for Providian. Earlier this month, Providian signed an agreement to sell its Argentine operations, including Providian Financial S.A. and Providian Bank S.A., to a local investor group in Buenos Aires. The Company expects to record a modest gain on the sale. In February, Barclays Bank signed an agreement to acquire the UK credit card operation of Providian Financial. The UK portfolio consisted of $565 million in receivables and about 500,000 cardholders. Also in February, banking regulators accepted Providian’s new Capital Plan and the company cut 11% of its workforce as it lowered overhead. For the fourth quarter Providian reported a net loss of $395 million from continuing operations, compared to an operating profit of $225 million for 4Q/00. Analysts have applauded Providian’s pace, led by new CEO Joseph Saunders, at cleaning up its business. Some analysts project Providian will climb to $14 per share over the next year and, barring any surprise developments, will trade well above its 52-week low of $2.00 per share. For complete details on Providian’s 4Q/01 performance visit CardData ([www.carddata.com][1]). (CF Library 6/8/99; 1/11/02; 1/18/02; 2/01/02; 2/8/02; 2/20/02; 3/8/02)

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


Tidel Switches Listing

Tidel Technologies, Inc. announced that it has received approval from The Nasdaq Stock Market to transfer its listing from the National Market to the SmallCap Market effective at the opening of business today. The Company’s trading symbol will remain “ATMS.”

Mark K. Levenick, Interim CEO, stated, “The voluntary transfer, which should be transparent to our shareholders, will afford Tidel the longest grace period to regain compliance with Nasdaq’s minimum bid price requirement of $1.00 per share. Tidel will now have until August 13, 2002 to resume trading above $1.00 per share. If the Company does not meet the minimum share price requirement by the August deadline, then Nasdaq will grant the Company an additional 180-day grace period if the Company continues to meet the other SmallCap Market initial listing criteria.”

Tidel Technologies, Inc. is a manufacturer of automated teller machines and cash security equipment designed for specialty retail marketers. To date, Tidel has sold more than 30,000 retail ATMs and 115,000 retail cash controllers in the U.S. and 36 other countries. More information about the company and its products may be found on the Internet at .


FTC Fine

A U.S. District Court has held a magazine subscription telemarketing group in contempt of court and ordered it to pay $39 million in consumer redress for violating the terms of a 1996 Federal Trade Commission settlement. Judge Vicki Miles-LaGrange wrote that despite the 1996 permanent injunction that barred various deceptive selling practices by the telemarketers, evidence presented by the FTC “…clearly and convincingly indicates that defendants’ acts and practices in connection with the sale of magazine subscriptions and magazine subscription packages violate the . . . Permanent Injunction.” The judge ordered H.G. Kuykendall, Jr., Diversified Marketing Service Corp., H.G. Kuykendall, Sr.; C.H. Kuykendall; National Marketing Service, Inc., NPC Corporation of the Midwest, Inc.; and Magazine Club Billing Service, Inc. to turn over the money to the FTC within 30 days of her order and ordered the FTC to submit a plan for the disbursement of this money to the court for review and approval. The Kuykendalls and their companies are based in Oklahoma City, Oklahoma. In March 1996, the FTC filed suit charging the defendants with making misrepresentations in connection with the telemarketing of magazine subscription packages to consumers. Specifically, the agency charged that the defendants misrepresented the cost or duration of the subscriptions; misrepresented the reason they obtained consumers’ account information; charged consumers’ accounts without authorization; refused to cancel subscriptions; misrepresented consumers’ rights to cancel telemarketing contracts under state law; and threatened to harm consumers’ credit ratings.


Hypercom Debt

Hypercom Corp., the leading global supplier of electronic payment solutions, Friday announced that it has sold 7.87 million shares of its common stock at a price of $5 per share to select institutional investors and high net worth individuals.

The proceeds will be substantially used to pay down high-cost mezzanine debt and to return the company to a more typical lending structure. The company expects that the transaction will be accretive to 2002 earnings as a result of reduced interest costs.

“This transaction is the last step in refinancing Hypercom and achieves the important strategic objective of further strengthening the company’s balance sheet,” said Christopher S. Alexander, president and chief executive officer.

“Our strong balance sheet, industry-leading products and execution of several strategic initiatives over the past 18 months clearly positions us to capitalize on the opportunities ahead and to create long-term value for our stockholders.”

The net proceeds of the private offering have been used to repay two term loans in the amount of $15 million and $5 million, respectively, under Hypercom’s credit facility, to repay $3.1 million in outstanding loans from a director and principal stockholder, and to reduce the outstanding borrowings under the company’s $25 million revolving credit facility. The remaining proceeds will be used for general corporate purposes.

Hypercom offered and sold the shares pursuant to an exemption from registration provided by Section 4(2) of the Securities Act of 1933. Hypercom anticipates that on or before April 18, 2002 it will file a registration statement with the Securities and Exchange Commission to register the shares for resale by purchasers in the private offering.

In the first quarter of 2002, the company will take an approximate $1.3 million charge, net of tax, as it expenses deferred loan costs associated with its retired term loans. It is expected that this charge will be completely offset through interest savings throughout the remainder of the year.

About Hypercom ([www.hypercom.com][1])

Hypercom Corp. is the leading global provider of electronic payment solutions that add value at the point-of-sale for consumers, merchants and acquirers, and yield increased profitability for its customers.

Hypercom’s products include secure Web-enabled transaction terminals that work seamlessly with its networking equipment and software applications for e-commerce, m-commerce, smart cards and traditional payment applications.

The company’s widely-accepted ePOS-infocommerce(TM) (epic) framework of consumer-activated, EMV-certified, touch-screen ICE (Interactive Consumer Environment) terminals enable acquirers and merchants to decrease costs, increase revenues and improve customer retention. Headquartered in Phoenix, Hypercom is independently acknowledged as the leading provider of point-of-sale card payment terminals worldwide. Demand for Hypercom’s terminals surpassed 1 million units last year alone. Hypercom today maintains an installed base of more than 5 million terminals in over 100 countries which conduct over 10 billion transactions annually.

Hypercom is a registered trademark of Hypercom Corp. ePOS-infocommerce and ICE are trademarks of Hypercom Corp. All other products or services mentioned in this document are trademarks, service marks, registered trademarks or registered service marks of their respective owners.

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