Wincor Nixdorf Attacks ATM Scams

ATM manufacturer Wincor Nixdorf will be offering new security devices by the end of this year to fight ATM fraud attacks such as the “Lebanese Loop” and card skimming. The “Lebanese Loop” is a sleeve of plastic or other material that is placed in the card reader, trapping the card and preventing it from being retained by the card reader. When the customer leaves the ATM, the thief, who may have seen the customer’s PIN number, then has access to the ATM card and account information. Wincor Nixdorf has developed a special holding mechanism that prevents the illegally installed device and the customer card from being removed. If the transport path is blocked the ATM is taken out of operation before the customer has a chance to enter the PIN number. ATM card skimming attacks occur when the account number on the ATM card is read via a fraudulent device called a skimmer. The skimmer is placed over the card reader so that the card can be fraudulently duplicated. Wincor Nixdorf has developed a special module that includes sensors that permanently monitor the ATM’s card slot so that if a fraudulent device is identified, the sensors immediately take the ATM out of operation. The new security devices will be available worldwide for Wincor Nixdorf “ProCashT” ATMs.

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Canadian Tire Bank Opens for Business This Week

Canadian Tire Bank will begin operations tomorrow. The Office of the Superintendent of Financial Institutions recently approved the new bank which is a wholly-owned subsidiary of Canadian Tire Financial Services. The bank will be used to fuel growth of the “Options MasterCard” portfolio and enable CTFS to cut costs. Currently, CTFS manages more than 2.5 million “Options MasterCard” accounts. These accounts make up more than 85% of Canadian Tire’s gross credit charge receivables. Financial Services plans to add at least 600,000 new accounts by the end of 2003 and convert the remaining 230,000 qualifying retail card accounts to the “Options MasterCard.” CTC’s Financial Services business had net credit charge receivables at the end of the first quarter of $1.86 billion, a 36.7% increase over 1Q/02.

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PayPal Immediate-Payment Coming to eBay’s Buy-It-Now

eBay said Friday that it is currently experimenting in select categories with “Immediate-Payment,” a PayPal solution that removes non-paying buyer risk by automatically charging the buyer’s credit card or bank account on “Buy-It-Now” transactions. The company also said it will begin in July to limit the number of bids a user with non-paying buyer complaints can make. eBay also announced that beginning this fall, the company will increase the amount of buyer protection available. In addition to the $200 currently available on eBay, which covers almost all transactions, later this year, eBay will launch “PayPal Buyer Protection.” The new program will allow verified PayPal sellers with a proven track record on eBay, those with a minimum of 50 feedback with 98 percent positive, to offer buyers $500 in coverage with no service fee. The new plan will cover about half of all listings on eBay. Available for sellers in the United States and Canada at launch, the program will cover non-delivery of items and items that are substantially not as described.

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Cyota Signs Turkish Card Issuer

Turkiye Is Bankasi has selected Cyota to provide MasterCard “SecureCode” and “Verified by VISA” to its card base of approximately 7 million cardholders. The bank will be the first in Turkey to launch the VISA and MasterCard authentication service. Isbank will use the Turkish version of Cyota’s “SecureSuite” that is fully localized to meet the specific language and configuration requirements of the Turkish market. The service will be supported locally by Innova IT Solutions, Cyota’s partner in the Turkish market.

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LML Payment Systems Reports Lower Loss

Vancouver-based LML Payment Systems reported the revenues for the fiscal year declined 5% to $8.8 million and that its net loss for fiscal 2003 was about $3 million compared to the previous year’s loss of $5.2 million. Cost of operations was approximately $6.9 million or approximately 78% of revenue compared to approximately $8.1 million or approximately 87% of revenue for the previous year, an improvement of approximately 15%. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) was a negative EBITDA of approximately ($691,000) or approximately (0.04) per share compared to a negative EBITDA of approximately ($2.1 million) or approximately ($0.11) per share for the previous year, an improvement of approximately 67%.

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Encore Merchant Services Signs an Agent

MD-based Public Health Service Federal Credit Union has become an agent of Encore Merchant Services, which is a division of MA-based Primax Payment Systems. Public Health Service Federal Credit Union will now be able to better service their members by being able to offer POS acceptance solutions to their members. Encore Merchant Services will be handling every aspect of payment card acceptance, including account application and establishment, point-of sale terminal deployment, product development, customer service, and risk management services.

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Metris Funds $125 Million Term Loan

Metris Companies announced Friday it has successfully funded the one-year, $125 million term loan agreement announced earlier this month which will help the company return to profitability. The Company used a portion of the proceeds to repay today the $100 million term loan due June 30, 2003. The completion of this funding represents a further step in the Company’s plan that is focused on liquidity and a return to profitability.

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CANADIAN TIRE BANK

Canadian Tire Bank will begin operations tomorrow. The Office of the Superintendent of Financial Institutions recently approved the new bank which is a wholly-owned subsidiary of Canadian Tire Financial Services. The bank will be used to fuel growth of the “Options MasterCard” portfolio and enable CTFS to cut costs. Currently, CTFS manages more than 2.5 million “Options MasterCard” accounts. These accounts make up more than 85% of Canadian Tire’s gross credit charge receivables. Financial Services plans to add at least 600,000 new accounts by the end of 2003 and convert the remaining 230,000 qualifying retail card accounts to the “Options MasterCard.” CTC’s Financial Services business had net credit charge receivables at the end of the first quarter of $1.86 billion, a 36.7% increase over 1Q/02.

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Over-Limit Fees to get Supreme Court Review

The U.S. Supreme Court has agreed to review a ruling over the treatment and disclosure of over-limit fees. The U.S. Court of Appeals for the Sixth Circuit in Cincinnati previously ruled that credit card over-limit fees should be part of the finance charge rather than a separate fee. The ruling came in response to a class action lawsuit filed against Household. The complaint charged Household with violating the “Truth in Lending Act.” The Supreme Court was asked by U.S. Solicitor General Theodore Olson to reverse the ruling of the lower court. A ruling on Household Credit Services vs. Pfennig is expected within the next year.

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Check Truncation Act of 2003 Passes Senate

The U.S. Senate passed the “Check Truncation Act of 2003” last week after the U.S. House passed the bill earlier this month. The legislation would, over the long term, increase the efficiency of the nation’s check clearing system by permitting the optional truncation or removal of the original paper check as soon as possible from the clearing and settlement process and enable electronic image processing. Banks desiring to continue processing paper could receive a substitute check, a paper reproduction created from an electronic image of the original check, for clearing and settlement and ultimate return to the account holder. A substitute check would have the legal equivalence of the original paper check.

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Ultramar Migrates to Keycorp K26 Terminals

Montreal-based Ultramar has decided to migrate to Keycorp “K26″ electronic payment terminals. Ultramar operates about 1,100 retail outlets in Eastern Canada. Although the initial order is for only 50 terminals, Ultramar has indicated that the”K26” will be the payment terminal of choice for its retail outlets as the older technology is replaced. A key step in the migration program will be customizing Keycorp’s special petroleum industry payment application software and migrating the legacy “Ultramar POS” application to the new Keycorp platform. Keycorp will also provide application enhancements for Ultramar.

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Capital One Renames Auto Finance Business

Capital One has changed the name of PeopleFirst Finance LLC to Capital One Auto Finance, an auto finance business Cap One acquired in October 2001. The change will leverage the strengths of PeopleFirst’s online business model with Capital One Auto Finance’s proven ability to provide customized consumer and dealer products and services. Capital One Auto Finance will also provide the convenience, ease and value of PeopleFirst’s direct-to-consumer online auto loans. PeopleFirst will be moving to the new web address http://www.capitaloneautofinance.com on June 27, 2003.

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