Impulsive Behaviors and Student Debt

A new study has found that 31% of students do not worry about debt and that 23% choose to ignore overdraft penalties and the prospect of months or years of paying off a debt incurred for a “moment of fun.”
The NARCA poll also found that 25% of college students think it is reasonable to run up a debt to splurge on a special celebration or to use a credit card as a way to “raise cash.” However, the poll discovered that 92% agreed bad debt will have a significant impact on a person’s ability to get credit in the future and 46% say they always keep records of their spending and receipts. NARCA noted that numerous surveys have endeavored to capture data on the growing amount of debt students acquire and maintain. But none have looked at what behaviors are feeding these bad habits.

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ePayments Acquires Federal Check Recovery

ePayments’ Federal Payments division is acquiring MO-based Federal Check Recovery. Federal Check Recovery delivers services throughout the U.S. through trade associations as well as through direct sales to merchants. Under terms of the agreement, ePayments increase staffing and continue to work with the former
company management. Account management will be handled through
ePayments’s Denver offices.

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Commerce Bank to Deploy ADS’ Epsilon

Loyalty marketer Alliance Data Systems announced that its
Epsilon business has signed an agreement with MO-based Commerce Bank to provide marketing solutions.
Under the terms of the agreement, Epsilon will provide a turnkey direct
marketing solution geared toward acquiring new customers for Commerce
Bank’s retail business unit. Specifically, Epsilon will develop and execute
several of Commerce Bank’s retail direct marketing programs, which include
creative development and distribution of direct mail campaigns as well as
analytic services for developing customer models and campaign support. Commerce Bank is part of
a $17.0 billion regional bank holding company.

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Element Payment Picks Hypercom

AZ-based Element Payment Services has chosen Hypercom’s “HBNet” transaction transport service and “SmartPayments Server” for the “Element Express Processing Platform.” Element’s IP payment platform provides its merchants with a “PCI DSS”-certified solution that is easy to manage and can readily scale with their business in a secure manner.
By establishing direct communication between the merchant and the “Express” system, Element can offer new certified payment services to its partners and merchants. These include dynamic changes to terminal applications, customized reports, and quick conversion of new customers through message translation, which eliminates the need for merchants to reprogram their point-of-sale devices.

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Obama and Biden – Credit Card Harmony?

The presumptive Democratic presidential nominee Barack Obama and his
newly announced running mate Sen. Joseph Biden may compliment and
strengthen each other in many areas but not in the credit card market.
Obama has made clear his support of credit card reform by endorsing many
of the proposals under consideration such as limiting interest and fees,
starting a rating system for credit cards and introducing the “Credit
Card Safety Act” last year. Obama is also calling for adjustments in the
bankruptcy reforms laws. On the other hand, Biden has long opposed any
regulation of the credit card industry and was a stanch supporter of
bankruptcy reform. He also reportedly had a close relationship with
MBNA, based in Delaware. Biden also received extensive
support from MBNA and according to the New York Times his son was paid
about $100,000 per year between 2001 to 2005 as a MBNA consultant.

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ADS Buys Crosstown Traders Portfolio

PA-based Charming Shoppes has agreed to sell a portion of its credit card portfolio to Alliance Data Systems for $40 million in cash. The sale is part of a deal to sell its TX-based misses apparel catalog business, collectively known as Crosstown Traders to Orchard Brands for $35 million in cash. The Company also announced that it will initiate a process to explore the sale of its Figi’s Gifts in Good Taste catalog business, based in Wisconsin.

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TNB Special Promotion Pays-Off for CUs

TNB Card Services’ recent “Life of Balance” balance transfer promotion
produced an overall response rate of 3.8% and boosted the card
portfolios of the participating credit unions.
Credit unions offering a LOB rate saw an average transfer of $3,590
compared with a $2,695 average transfer for credit unions that opted for
a limited time promotional rate. Generating nearly a half million
dollars in balances, TX-based Shell FCU, is halfway to achieving its
goal of adding $1 million in card balances this year. The $284 million
credit union averaged $3,383 per transfer check and a 4% response rate,
which was a 58% increase in responses over its previous LOB
rate offer in early 2007. TexasOne Community Credit Union of Houston
achieved a 5.97% response rate with its LOB rate offer. With an average
transfer of $3,694, the credit union brought in more than $380,000 in
new card balances.

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BEST WESTERN VS SUNDAY HERALD

The Best Western Hotel chain has refuted what they claim are
‘unsubstantiated’ inaccuracies of a security breach into information
regarding customer records. Distributed by the Glasgow Sunday Herald,
the hotel chain is scrutinizing the publication for unfounded
exaggerations concerning the security of the organization’s Central
Reservations division, which were made on the limited basis to the
affect of a possible compromise of a select portion of data, which
happen to have been brought to attention by a Herald reporter. In
response, Best Western has disclosed assurance to all those concerned
there is no evidence to suggest need for concern and frequent
evaluations demonstrate the organization is compliant with PCI DSS,
which does require periodic evaluation, testing, and re-certification of
compliance.

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Stockholders Sue CompuCredit Over Financials

A class action lawsuit against CompuCredit has been filed in Georgia,
alleging the officers and directors violated the
Securities Exchange Act of 1934. CompuCredit provides credit and
related financial services and products
to what it refers to as “underserved” and “un-banked” consumers. The
complaint specifically alleges Defendants issued materially false and
misleading statements regarding the Company’s business and financial
results. As a result of CompuCredit’s false statements, its stock traded
at artificially inflated prices during the Class Period, reaching its
Class Period high of $40.61 per share in December 2006. According to
the complaint, Defendants materially misrepresented the
Company’s solvency in violation of the federal securities laws in the
following manner; praised the strength and
integrity of the Company’s credit card marketing and collections
services and its customer friendly products, when in fact the Company
was engaging in deceptive and fraudulent marketing and collection
practices; falsely touted the growth of the Company’s
credit card business without disclosing that such growth was based on
fraudulent conduct and that the Company faced material risk of
rescission of the fees and payment of massive fines; claimed the Company
was in compliance with applicable federal
regulations even though its marketing and collecting practices violated
such regulations; and misrepresented the FDIC and FTC
investigations into the Company’s accounting practices, falsely
indicating that the Company had taken measures that addressed most
of the regulators’ concerns, and any settlement would not have a
material impact on its financial condition.

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Key Business Online Expands Fraud Capabilities

OH-based KeyBank has introduced online banking features that combine
check and ACH fraud prevention capabilities designed especially for
small and medium-sized enterprises. The new fraud prevention features
enable businesses to review the previous day’s posted check and ACH
items and reverse those that appear to be fraudulent or unauthorized.
This makes it possible to recognize and halt fraud early.
In its enhanced version of Key Business Online, Key has also added
a new feature to help businesses recover funds on deposited items
returned for non-sufficient funds. KeyCorp is one of the nation’s
largest bank-based
financial services companies, with assets of approximately $102 billion.

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APAX PCI

Among the handful of 110 compliant card processing companies and banks,
APAX Global Payment & Technologies AG is now compliant with the Payment
Card Industry (PCI) data protection standards. Endorsed by Visa,
Mastercard Worldwide, JCB International, American Express and Discover
Financial Services, this compliance ensures APAX cardholder account data
is secure through 12 requirements of merchants and service providers
which store, process or transmit payment card data. APAX Global Payment
& Technologies AG is an international provider of electronic payment and
risk management solutions, supporting processing for more than 100,000
cardholders.

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