Gemplus SIM Card

Gemplus and Sonera SmartTrust announced this morning they will enter the market with a ‘GSM SIM’ card, featuring digital signature and Public Key encryption. This is enabled by Sonera SmartTrust technology embedded in the Gemplus SIM card. Mobile operators using this technology with advanced SIM cards will be able to offer their customers a whole new set of secure wireless e-commerce solutions. Analysts predict explosive growth for the mobile device market in the next few years, with most predicting one billion mobile phones in use within the next three to four years.

Casino Cash Biometrics

Patrons may have to show their face to get cash at some casinos. Global Cash Access and Infonox, a Silicon Valley Internet company that develops web-based software for the financial services industry, have entered into an agreement to use Viisage Technology’s patented facial recognition technology in GCA’s new automated cashier machine. GCA’s ‘ACM’ system fully integrates ATM, credit card cash advance, check-cashing, POS debit, Western Union, patron credit markers, and one-to-one marketing opportunities. Infonox develops Internet appliances which provide transaction processing, transaction management and transaction reporting services using its proprietary middleware product, ‘Infonox Active Layer’. GCA and Infonox have also entered into an agreement with Diebold to supply the ‘ACM’ kiosk.

Mondex Originator System

The world’s first full-function ‘Mondex Originator’ system to support smart card electronic cash has been introduced. ACI Worldwide and Mondex Australia announced yesterday the successful installation of the ‘Originator Territory Management System’. The management and control of Mondex e-cash in circulation in any particular currency territory is the responsibility of an ‘Originator’-set up by the local Mondex franchisee. The ‘Mondex Originator’ in each currency territory plays a role similar to that of a central bank in relation to traditional cash, by creating and distributing Mondex electronic value and ensuring the integrity of the system. ACI says the ‘Originator Territory Management System’ completes its set of Mondex products, with ACI now providing end-to-end solutions to support the spectrum of relationships for card issuers including cardholders, merchants, Originator, card manufacturers and other service providers. Mondex says it is now the most market-ready e-cash scheme in Australia.

Providian Opens Austin Center

Providian Financial announced Thursday that it will open a new operations center in Austin, Texas, to accommodate growth in the Company’s consumer lending businesses. Providian plans to hire approximately 600 employees to staff the facility, which is expected to open in March.

The new Austin facility will be Providian’s third in Texas. The company has had a presence in Arlington since June 1999 when it opened a credit card operations center there that now employs over 1,000 people, and it announced in December that it will open an additional operations center in San Antonio by mid-February.

“The tremendous growth in new customers we’ve been experiencing has created the need for additional facilities,” said David Alvarez, president of Providian’s credit card division. “We are happy to be part of the Austin business community and are eager to have area residents join our talented and growing employee population.”

Providian will lease 60,000 square feet at 6500 Tracor Lane. Because the facility was most recently used as a call center, minimal remodeling will be required, enabling Providian to open the center quickly. Recruiting will begin later this month to hire customer representatives and managers.

“Texas offers a very hospitable business climate and, by establishing offices throughout the state, Providian can also benefit from efficiencies in technology, recruiting, and management,” said Providian Vice President Dan Barnard, who is in charge of the company’s facilities. “Equally important is the fact that Austin offers a fast-growing, highly qualified labor force that will support our commitment to growth and 100% customer satisfaction.”

Today, San Francisco-based Providian Financial employs more than 11,000 people nationwide and in the United Kingdom, with facilities in Arlington, Texas, as well as Fairfield, Oakland, Pleasanton, Sacramento, and San Francisco, California; Salt Lake City, Utah; Louisville, Kentucky; Concord and Tilton, New Hampshire; and London, England.

About Providian Financial

San Francisco-based Providian Financial Corporation ([http://www.providian.com][1]) is a leading provider of lending and deposit products to customers nationwide and also offers credit cards in the United Kingdom. Providian serves a broad, diversified market with loan products that include credit cards, home equity loans, secured cards and membership services.

With a commitment to 100% customer satisfaction, Providian’s mission is to help its customers build or rebuild, protect and responsibly use credit by providing a quality borrowing experience that leads to active and lasting customer relationships. Providian has $20 billion in assets under management and over 11 million customers.

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

Card-Activated Business Centers

The pioneer of credit card activated business centers got a shot in the arm yesterday from Big Blue. Wayne, PA-based USA Technologies announced Thursday its flagship product, ‘Business Express’ will be added to IBM’s offering portfolio and sold through IBM’s national call center. ‘Business Express’ is the world’s first 24-hour credit card-activated business center each offering business travelers and consumers fast access to desktop workstations, laptop PCs, printers, copiers and fax machines. ‘Business Express’ and ‘Mail Boxes Etc. Business Express’ are currently located in approximately 400 US hotels. USTT has formed an alliance with IBM Global Services that could lead to the installation of up to 5,000 ‘Business Express’ facilities throughout North America. IBM also agreed assist USA Technologies with migrating its proprietary ‘TransAct’ credit card authorization and payment system to the Internet. IBM will also manufacture USTT’s new ‘e-Port’ swipe card technology.

NextCard CIO

NextCard, Inc.,, creator of The First True Internet Visa, announced it has appointed industry veteran Steven Rubinow to the position of chief information officer.

Rubinow brings two decades of technology and information services experience from leading companies such as AdKnowledge, Fidelity Investments, Budget Rent a Car and the Quaker Oaks Company. In this new position at NextCard, Rubinow will be responsible for continuing to build NextCard’s industry leadership position through technology. He will drive all aspects of NextCard’s technology organization.

“This key appointment of Steve Rubinow to NextCard’s senior management team will help us evolve from the leading credit card provider over the Internet to our vision of defining the Internet transaction experience for the consumer,” said Jeremy Lent, chairman and CEO of NextCard. “Steve’s proven business and technology expertise, as well as his knowledge of the Internet and database marketing arena, will be a tremendous asset to our strategic development.”

Rubinow was most recently the CIO at Palo Alto-based AdKnowledge, a leading provider of web advertising management products for advertisers and their agencies, where he was responsible for operations, internal MIS, engineering for database-centric products and database marketing.

Prior to AdKnowledge, Rubinow served as vice president of corporate management information systems at Fidelity Investments in Boston, where he developed systems that combine the numerous sources of data from the investment industry and developed them into actionable recommendations for the management of the company.

Prior to Fidelity, Rubinow was vice president of market planning at Budget Rent a Car, where he managed worldwide marketing research and product development. Earlier, Rubinow served as director of decision support services at the Quaker Oats Company, where he was responsible for the development of analysis and systems to aid decision making in many areas of the company.

Rubinow has an M.S. in Computer Science from DePaul University and a Ph.D. in Chemistry from the University of Illinois, as well as a M.B.A. in Marketing and Finance from the University of Illinois.

NextCard, Inc.

NextCard, Inc. ([http://www.nextcard.com][1]), creator of The First True Internet Visa in 1997, is considered the industry’s leading issuer of consumer credit on the Internet. The Company has continued to innovate with its complete GoShopping!(SM) Web site, NextCard Concierge(SM), personalized PictureCard(SM) design and exceptional online customer service.

NextCard is consistently a top 10 online advertiser, operates a network of over 25,000 affiliates and has exclusive card relationships with leading brands including Amazon.com and DILBERT.

The Company publishes the NextCard eCommerce Index(SM), the premier source of online transaction activity and was named a “HOT 100 Company” by Upside magazine and one of “The Standard 100” most important and influential companies in the Internet economy by The Industry Standard magazine. NextCard was ranked the No. 1 credit card brand Internet consumers would consider for use according to ZDNet’s 1999 BrandIQ research study.

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

Cap One Investor Relations Director

Capital One Financial Corporation announced the appointment of Tracy Teal as Director of Investor Relations. In this role, Ms. Teal will be responsible for conducting market research and delivering the company’s strategies and global growth objectives to the financial community. She joins Janet McCabe in reporting to Paul Paquin, Vice President of Investor Relations.

Ms. Teal joined Capital One in 1996 from Coopers & Lybrand. As a CPA, Ms. Teal has structured securitization transactions for compliance with accounting standards and advised business managers and senior management on the impact of new accounting rules and policies. Since April 1999, as Corporate Finance Manager-International, Ms. Teal has supported Capital One’s international expansion by helping to structure joint ventures and alliances to optimize the company’s results.

“Tracy’s experience with our business units and global growth plans is a tremendous asset to our investor relations team,” said Paul Paquin, Capital One’s Vice President of Investor Relations. “We have assembled a team of the best in the business. Tracy is just one example of the power of hiring good people.”

Ms. Teal replaces Julie Rakes in this role. Ms. Rakes, upon her return from maternity leave, will take the lead role in developing the financial management function for the company’s Internet initiatives.

Headquartered in Falls Church, Virginia, Capital One Financial Corporation ([http://www.CapitalOne.com][1]) is a holding company whose principal subsidiaries, Capital One Bank and Capital One, F.S.B., offer consumer lending products. Capital One’s subsidiaries collectively had 20.8 million customers and $18.5 billion in managed loans outstanding as of September 30, 1999, and are among the largest providers of MasterCard and Visa credit cards in the world. Capital One trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 500 Index. For the second consecutive year, Capital One was named to Fortune’s list of “Best Places to Work.”

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

Top Telemarketing Frauds

The National Consumers League yesterday released its 1999 list of the ‘Top Ten Telemarketing Fraud Complaints’. Credit card offers placed #7 on the list and credit card loss protection was ranked #9. The NCL says phony promises of credit cards requiring the payment of fees in advance is the primary credit card compliant. The loss protection complaints centers around the use of scare tactics and misrepresentations to sell unnecessary insurance to cardholders. The top NCL fraud complaint: work-at-home schemes.

Big 3 Responds

Following yesterday’s FTC settlement Trans Union insisted FCRA does not contain any specific standards for telephone service levels. TU says it requires only that national consumer reporting companies include a statement on credit report disclosures sent to consumers that the company has a toll-free number at which personnel are accessible to consumers during normal business hours. TU further insisted the law does not define what constitutes “accessible.” Experian says it has already adopted new service level standards to handle the 1 million calls it receives each month. Equifax also says it has taken steps to improve compliance with FCRA. However, Equifax noted it created the credit reporting industry’s first world-class consumer call center in 1991 and also was the first to provide consumers with toll-free numbers that same year, long before it was addressed by the FCRA.

Big 3 FCRA Sins

The big three, national consumer reporting agencies agreed to pay $2.5 million to settle charges that they each violated provisions of the Fair Credit Reporting Act by failing to maintain a toll-free telephone number at which personnel are accessible to consumers during normal business hours. According to the FTC’s complaints, Equifax, Trans Union and Experian blocked millions of calls from consumers who wanted to discuss the contents and possible errors in their credit reports and kept some of those consumers on hold for unreasonably long periods of time. The FTC also alleges that Equifax and Trans Union blocked certain incoming telephone calls based upon the location of the call, including, but not limited to, area code. Each of the proposed settlements would require that the CRAs maintain a blocked call rate of no greater than 10% and an average hold time of no greater than three minutes and thirty seconds. The CRAs will be required to conduct regular audits to monitor compliance. Under the financial terms of yesterday’s settlement, Equifax has agreed to pay $500,000, and Experian and Trans Union both have agreed to pay $1 million.

MBNA & Pirates Renew

MBNA announced Thursday the renewed endorsement of the Pittsburgh Pirates for MBNA’s credit card services through 2004.

MBNA has the endorsement of 15 Major League Baseball teams with the Pirates’ renewal, and is the Official Credit Card Issuer of Major League Baseball along with more than 130 other baseball related endorsements.

The endorsements of the 15 Major League Baseball teams are an important component of MBNA’s Sports sector, one of MBNA’s fastest growing areas, with more than 550 relationships with sports organizations. Among the endorsements received by MBNA are Major League Baseball, the National Baseball Hall of Fame, the National Football League, the National Hockey League, and the National Association for Stock Car Auto Racing (NASCAR).

MBNA Corporation (NYSE: KRB), a bank holding company and parent of MBNA America, N.A., a national bank, has $72.3 billion in managed loans. MBNA, the largest independent credit card lender in the world, also provides retail deposit, consumer loan, and insurance products.

Racal EMV Smart Cards

Racal Security and Payments is offering VISA and MasterCard member banks a low-price package to personalize smart cards for the increasing number of pilot schemes now being undertaken. Costing approximately a third of the price of a full system, Racal has a number of packages to enable members to issue cards in-house, allowing them to retain total management and not have to rely on expensive third party providers.

The Racal initiative recognizes the difficulties faced by banks in performing the personalization preparation and the physical personalization of smart cards. The development of smart card applications and the learning curve for the new technology is exceptionally time consuming and expensive. Significantly reducing this time and cost, Racal’s off-the-shelf packages allow participating organizations to market their payment and non-financial products without delay.

Complementing Racal’s standard range of P3 products, the P3 software suite will support all the EMV (Europay MasterCard Visa) debit/credit, EMV parameters and Visa cash applications. The package allows for easy movement to a full roll-out program after the pilot scheme is completed.

Racal’s solution provides a secure integral key management environment which allows the card issuer to control the whole key management architecture. The products will also enable issuers to understand all of the areas surrounding the management of card stock, key management, issuance processes and the ‘virtual real estate’ management for the new technology. In this way, the pilot scheme will provide issuers with vital “personalization” experience prior to the full roll-out of the scheme.

Pre-eminent in secure payment, electronic commerce, card payment, secure remote access and enterprise network security, Racal Security and Payments manufactures a comprehensive range of world-leading point of sale terminals and management systems, as well as secure payment systems and network encryption solutions. For almost two decades, Racal has been at the forefront of security and payment technology, co-operating and contributing to set the industry standards used for financial transactions and electronic commerce globally. Racal’s Security and Payments business is part of the Racal Electronics Group that has operating companies world-wide.

Visit the Racal Security and Payments web site at [http://www.racalitsec.com][1].

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