Concord EFS, Inc., a leading electronic commerce provider, announced it has expanded the deposit risk management services it offers through its majority-owned subsidiary, Primary Payment Systems, Inc. In April 2001 Concord increased its ownership position in Primary Payment Systems to 85% through the purchase of newly issued shares, which largely funded Primary Payment Systems’ acquisition of Wally Industries, Inc. (doing business as WJM Technologies), the industry leader in new account fraud detection systems. The combined company’s risk management products will provide the financial services and retail industries with comprehensive tools to reduce deposit account and securities account fraud and its related expense. Primary Payment Systems’ products are marketed to financial institutions directly and through Concord’s STAR(SM) network, the largest PIN-secured debit network in the U.S. The incremental investment was not material to Concord’s financial statements.
! Primary Payment Systems operates and safeguards a national financial institution-owned database, currently composed of 145 million deposit accounts, which provides participating financial institutions with information on potentially fraudulent checks or high-risk accounts. WJM provides front-end tools to help financial services and other firms identify potentially fraudulent accounts before they are opened and activated. Through its Early Warning(R) software product, WJM currently screens over 70% of all new banking customer relationships in the U.S. With the addition of WJM’s systems and information, Primary Payment Systems now offers the three types of database information important to fraud reduction: accounts, transactions, and people. “Deposit account fraud creates enormous expense for the financial services industry, but most risk management services have traditionally focused on loan risk rather than deposit risk,” said Edward A. Labry III, Concord president. “Primary Payment Systems compiles, protects, and facilitates access to financial institutions’ pooled account information to help them avoid fraud losses. With WJM’s systems, this service becomes even more proactive, providing participants with the most complete information available to help them manage their account risk. These enhancements are part of our ongoing initiatives in Concord Network Services to bring new and improved deposit-based services to financial institutions nationwide.”
About Concord EFS, Inc.
Concord is a vertically-integrated electronic transaction processor, providing transaction authorization, data capture, settlement and funds transfer services to financial institutions, supermarkets, petroleum retailers, convenience stores, and other independent retailers. Concord’s primary activities include Payment Services, providing credit, debit, check authorization, and electronic benefits transfer (EBT) processing services to selected retail segments; and Network Services, providing gateway processing, ATM driving, online and signature debit card processing, risk management, and network access to the financial services industry under the STAR(SM) brand. Concord currently provides processing services and network access to approximately 6,500 financial institutions nationwide. Concord holds a majority interest in Primary Payment Systems, Inc., which provides risk management services to financial institutions, credit card issuers, securities and brokerage firms, and retailers. Concord acquired an initial 74% interest in Primary Payment Systems through its acquisitions of Cash Station, Inc. in 2000 and Star Systems, Inc. in 2001. Concord news releases, links to SEC filings, and other information are available on its corporate web site at [www.concordefs.com].