FDC to Exit Check and MO Business

First Data this morning announced it has decided to gradually exit its “Official Check” and “Money Order” business. The decision followed a strategic review. The wind-down is expected to free up between $250-$300 million in cash. The revenue for the business is primarily driven by investments in long-term securities. Over the next four to six months, FDC will convert most long-term instruments into more liquid instruments of shorter duration. FDC will serve existing clients through the end of their respective contract terms but expiring contracts will not be renewed on a long-term basis. Client contracts representing approximately 60% of portfolio balances will expire in the next two years.

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MedCom 4Q/06 Income Drops by 27%

MedCom USA has reported improved financial and operating results for the second quarter ending December 31, 2006, showing significantly higher gross margins, substantially lower operating expenses and another quarter in a row of positive EBITDA. Net revenue for the second quarter was $1,467,904 as compared to $2,018,738 for the comparable period last year, a decrease of 27%. For the six months ending December 31, 2006, net revenue was $3,068,496 as compared to $4,127,068 for the comparable period last year. This is a decrease of 26%. Net loss for the first six months of Fiscal Year 2007 declined by 69% to $868,240, or $0.01 per diluted share, compared to a net loss of $2,788,012, or $0.05 per diluted share in the same period last year. MedCom USA provides healthcare and financial transaction solutions for electronically processing HIPAA compliant transactions within the healthcare industry.

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Experian Settles Again on Free Reports

The Federal Trade Commission and Experian Consumer Direct have reached a settlement in a dispute over the marketing of free credit reports. The FTC says the “free credit report” offer failed to disclose adequately that consumers who signed up would be automatically enrolled in a credit-monitoring program and charged $79.95. The FTC alleged that the failure to clearly disclose the enrollment and charges violated a previous settlement. Consumerinfo.com, doing business as Experian Consumer Direct, agreed to pay $300,000 to settle the charges. In August 2005, Consumerinfo.com, paid $950,000 to settle FTC charges that it deceptively marketed “free credit reports.”

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AlertSite and Sunera Team for PCI

FL-based AlertSite has partnered with FL-based Sunera to provide a complete PCI compliance and security scanning solution enabling merchants and credit card service providers to achieve and maintain PCI compliance. The PCI compliance and security scanning solution provides confidentiality, integrity and availability of cardholder data while minimizing the impact on business operations. Sunera offers enhanced PCI compliance. AlertSite is a leading provider of web performance measurement, systems monitoring and security vulnerability scanning products and services. Sunera is a provider of risk and controls consulting services.

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TJX Finds More Payment Card Data Intrusions

MA-based TJX Companies says the 2006 security breach that opened millions of cardholder personal data to outsiders may also have been intruded upon in July 2005 and on various subsequent dates in 2005. TJX also has found additional drivers’ license numbers together with related names and addresses that it believes were recently compromised. This information was associated with unreceipted merchandise returns at its T.J. Maxx, Marshalls, and HomeGoods stores in the U.S. and Puerto Rico for the last four months of 2003 and May and June 2004. In addition to the customer data the Company previously reported as compromised, the Company now believes that information regarding portions of the credit and debit card transactions at its U.S., Puerto Rican and Canadian stores (excluding debit card transactions with cards issued by Canadian banks) from January 2003 through June 2004 was compromised. The Company had previously reported that the 2003 transaction data had potentially been accessed. For most of the transactions from September 2003 through June 2004, some of the card information was masked at the time of the transaction, making that portion unavailable to the intruder. TJX took a charge of approximately $5 million for costs incurred due to the recent security intrusion in the fourth quarter, which includes costs incurred to investigate and contain the intrusion, enhance computer security and systems, and communicate with customers, as well as technical, legal, and other fees. Beyond this charge, TJX does not yet have enough information to reasonably estimate losses it may incur arising from this intrusion, including exposure to credit and debit card companies and banks, exposure in various legal proceedings that are pending or may arise, and related fees and expenses, and other potential liabilities, costs and expenses.

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Cash Systems Inks a Big Casino Contract

Las Vegas-based Cash Systems has entered into a new multi-year contract with Canterbury Park Racetrack and Card Club where Cash Systems will provide its full line of cash access services including “all-in-1atm” services, an ATM with multifunction capability, “casinopc” for cash advance services that offers the full range of services for processing and completing transactions at the casino cage, all residing on one system, “ecash” checking and “full service booth operation” which allows the gaming establishment to hand off all the responsibility for completing financial transactions within the gaming facility to Cash Systems. This is a turn key solution for the gaming facility and off loads the risk and responsibility for all financial transactions conducted in the gaming facility.

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FDC Acquires Intelligent Results & Datawire

First Data has inked deals to acquire a customer data analytics and decision management software company and a firm specializing in Internet-based transaction delivery. FDC signed an agreement to acquire Intelligent Results, a firm that has developed a proprietary customer analytics and decision management platform that integrates and automates the data analytics to action process. The company currently serves clients in the financial services, utilities and government services markets. FDC also announced it has acquired the assets of Datawire Communication Networks. Datawire Communication Networks offers the “Datawire VXN,” a globally deployed “Transaction Delivery Network.” The VXN network is designed to globally transport any real-time data, such as financial transactions, with optimum security and reliability.

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ACEC Tackles Merchant Check-Out Fees

Americans for Consumer Education and Competition has established a new microsite, “StopCheckOutFees.com”. Its intent is to give consumers a voice regarding the proposed rules that allow merchants to impose check out fees or surcharges on consumers who pay with payment cards. “StopCheckOutFees.com” provides information on which states have “No Surcharge” rules in statute and those that don’t. The site references Australia whereby merchants promised to lower their prices in exchange for greater regulation of the interchange fee which funds the cost of processing electronic transactions and providing fraud and security measures. Following Australia’s increased regulation, analyses of the fall out show Aussie consumers are the losers as cardholders lost valuable rewards benefits and most merchants not only failed to lower their prices but began imposing check out fees as well. Americans for Consumer Education & Competition advocates for financial literacy and consumer rights initiatives.

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Billeo Offers LINK2GOV Payment Options

CA-based Billeo has entered into an agreement with LINK2GOV making PAY1040.com a participant in Billeo’s browser toolbar solution offering virtual consolidation of bills which enables consumers to pay their federal taxes with a credit card. Billeo serves as a bill pay assistant by allowing users to aggregate bill payments, organize bill reminders, and keep payment records. Online payments through the Billeo service can be made with a debit card, credit card or their checking account, and it provides the advantage of receiving immediate payment confirmations. LINK2GOV, an IRS-authorized payment provider is a business unit of Metavante Corporation. Billeo provides consumers with an online bill management service and password manager.

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Comerica Renews GPN Processing Contract

Global Payments has extended its alliance relationship with Comerica Bank through January 2014, continuing Global Payments’ comprehensive payment card and check processing services for Comerica Bank’s merchant services customers. The original agreement between the two financial services organizations began in 1996. Comerica Bank is a subsidiary of Comerica Incorporated. Global Payments is a provider of electronic transaction processing services.

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Euronet Q4 EFT/PP Transactions Top 260MM

KS-based Euronet Worldwide’s reported that its profits for the fourth quarter more than doubled compared to the year-ago quarter. The Company posted fourth quarter revenues of $166.8 million, an 16% increase over 4Q/05. Net income soared to $15.4 million, compared to $7.2 million for the fourth quarter 2005. “EFT Processing” posted revenues of $35.3 million, compared to $29.3 million for 4Q/05. Transactions processed were 128.1 million, compared to 103.1 million transactions in the same period last year. The EFT Segment completed the quarter with 8,885 ATMs owned or operated. “Prepaid Processing” reported revenues of $124.6 million, compared to $111.7 million for the fourth quarter of last year. Transactions processed were 132.1 million, compared to 100.0 million transactions in the fourth quarter 2005. The “Software Solutions” segment produced revenues of $6.9 million for the quarter. Combining all segments, transactions processed in the fourth quarter 2006 were 260.2 million compared to 203.1 million processed in the fourth quarter of 2005. For complete details on Euronet’s latest results visit CardData ([www.carddata.com][1]).

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

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eFunds’ 4Q/06 Net Income Soars by 72%

AZ-based eFunds reports that fourth quarter net revenue increased 2% to $141 million, compared to the same quarter of 2005. Fourth quarter net income grew 72% to $20 million, compared to 4Q/05. However, the Company posted a 3% year-on-year decline in its U.S. Payments segment with $75.4 million in revenue. The International segment soared by 26% to $21.0 million but the U.S. Risk Management segment was flat at $44.6 million. eFunds also reported that it now expects full year 2007 net revenues to increase 7% to 11% over 2006 net revenues. For complete details on eFunds’ fourth quarter performance, visit CardData ([www.carddata.com][1]).

eFunds Revenue Historical
4Q/04: $130.5 million
1Q/05: $114.2 million
2Q/05: $116.3 million
3Q/05: $133.2 million
4Q/05: $138.0 million
1Q/06: $139.7 million
2Q/06: $132.4 million
3Q/06: $139.4 million
4Q/06: $140.9 million
Source: CardData (wwww.carddata.com)

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

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