eConnect Fallout

Trading in the stock of San Pedro,CA-based eConnect continues to be suspended amidst new allegations of fraud. Earlier this month the firm claimed to have an exclusive deal to provide wireless credit card transactions via the new ‘PalmPilot VII’. The news sent eConnect’s stock soaring from $3 per share to $21 per share within one week. The SEC halted trading on March 13 citing concerns over the company’s recent press announcements and revenue projections. Yesterday a class action lawsuit was filed on behalf of stockholders. The complaint alleges that eConnect failed to disclose that it had never acquired Top Sports SA as announced in November; did not generate anywhere near $10,000 a day from its ‘PowerClick’ division’s network of websites as it announced in Feb. 22; did not have a strategic alliance with Empire Financial Group as announced Feb. 28; and did not have an agreement to use an internet cash payment system developed by SafeTpay as announced Feb. 29. eConnect responded yesterday by retaining a former SEC enforcement division attorney, signing a new public/investor relations firm, and clarifying past news releases. eConnect admitted its PalmPilot licensing arrangement for wireless payment card transactions was nothing more than a standard license agreement downloaded from the Internet off of Palm Inc.’s Web site.

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Cap One Hires West

Catherine West, formerly Executive Vice President of First USA Bank, joined Capital One as senior vice president in charge of Risk operations. Ms. West will be responsible for executing Capital One’s risk strategy, which includes fraud, collections, and recoveries.

“Capital One is committed to building a lifetime customer franchise,” said Nigel Morris, Capital One’s President and Chief Operating Officer. “Our ability to manage a customer’s risk allows us to make the best offers in the credit industry and enables Capital One to lead the industry with the lowest charge-off rates. I am very pleased that Catherine has decided to join our leadership team. Her extensive experience in the credit card industry will greatly benefit Capital One as we continue to grow.”

Catherine West commented, “Clearly what attracted me to Capital One was the high caliber of talent and the innovative and creative entrepreneurial culture. What attracted me to the job was the idea of extending Capital One’s vision into Risk-a vision that is focused on the needs and wants of the individual customer.”

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 financial products and services to consumers. Capital One’s subsidiaries collectively had 23.7 million customers and $20.2 billion in managed loans outstanding at December 31, 1999, and are among the largest providers of MasterCard and Visa credit cards in the world. Capital One is listed on the New York Stock Exchange under the ticker symbol “COF.”

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

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Diebold Names Geswein CFO

Diebold, Incorporated announced that Gregory T. Geswein, 45, has been named senior vice president and chief financial officer and a member of the executive team. Geswein, who was most recently senior vice president and CFO at Pioneer-Standard Electronics Inc., Cleveland, Ohio, has broad experience in global acquisitions, international operations and e-business.

Pioneer-Standard, a $2 billion leading global distributor of electronic components and mid-range computer systems, was recently named number three on the PC Week Fast-Track 500 list for its aggressive implementation of e-commerce, business extranets and Web technologies.

Geswein is noted for his proven expertise throughout his career in global acquisitions, including absorbing acquired organizations into existing financial processes and systems. He is also known for his ability to overhaul and streamline financial processes and implement high-tech financial systems, resulting in improved productivity and faster flow of information.

Prior to his assignment at Pioneer-Standard, Geswein spent 13 years at Mead Corporation, Dayton, Ohio, a $4 billion international paper products manufacturer, in a variety of senior financial posts, including vice president and corporate controller and corporate treasurer.

“We’ve been expanding significantly and simultaneously in numerous international markets in recent years and need a CFO with experience not only in the global technology industry, but also in integrating diverse acquisitions with existing corporate systems and processes,” said Walden W. O’Dell, president and chief executive officer. “Greg’s unique combination of experience in these areas and his high-energy, creative approach to business challenges make him well suited for this position. We will be looking to him to focus intensely on building shareholder value.

“Greg also brings significant experience and knowledge in the streamlining of processes and deployment of technologically advanced financial systems, creating an environment where information flows quickly and efficiently.”

Originally from Ironton, Ohio, Geswein earned a bachelor’s degree in Business Administration from the University of Cincinnati. He went on to earn a master’s degree in business administration with a concentration in finance from the University of Cincinnati. Geswein and his wife have two children and currently reside in Bentleyville, Ohio.

Diebold, Incorporated is a global leader in providing integrated self- service delivery systems and services. Founded in 1859, Diebold employs more than 9,000 associates with representation in more than 75 countries worldwide and headquarters in Canton, Ohio, USA. Diebold reported revenue of $1.3 billion in 1999 and is publicly traded on the New York Stock Exchange under the symbol ‘DBD.’ For more information, visit the company’s Web site at [http://www.diebold.com][1].

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

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Blue Card Milestone

American Express has signed up an average of 200,000 cardholders per month for its new ‘Blue’ smart card. AmEx launched the card September 8, kicking-off a $45 million promotional campaign. Atlanta-based Brittain Associates says a survey of 2,000 consumers it conducted between March 1 and 7, confirms there are now over one million ‘Blue’ cardholders. AmEx expects to issue two million ‘Blue’ smart cards by the end of this year. Brittain says it is now conducting on-line interviews with over 1,000 ‘Blue’ card owners, asking about such things as usage patterns, payment behaviors and favorite features of the card. The ‘Blue’ card offers no-annual-fee, a 0% six-month intro APR, and a fixed 9.99% minimum, go-to APR. The new card also has a mag stripe and a chip. The chip feature enables consumers to activate, from a PC smart card reader, the optional ‘American Express Online Wallet’. In late January AmEx added a free rewards program to the card called: ‘BlueLoot’. The rewards program offers one point for each dollar charged and offers rewards such as PalmPilots and MP3 players. During the first six months, the ‘Blue’ card hit a number of snags, such as production problems and delays with the PC smart card reader and the translucent card design.

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VISA – Marriott Promotion

Visa U.S.A and Marriott are launching a promotion April 1 to offer double ‘Marriott Rewards’ points for VISA cardholders. Starting with the second hotel stay paid for with a VISA card, ‘Marriott Rewards’ members will earn up to 20 points per dollar, double the normal 10 points per dollar. The promotion runs through June 30. The offer is not available to cardholders in Germany, Austria and Belgium. ‘Marriott Rewards’ has 1,800 participating hotels and more than 12 million members.

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Equifax Hires Cummins

Equifax named J. Michael Cummins corporate vice president and chief marketing officer, a new position at the company. Cummins, director and chief executive officer of the Georgia Center for Advanced Telecommunications Technology (GCATT) at Georgia Tech, will join Equifax April 15, 2000.

“Equifax is a powerful brand,” Chapman said. “And Mike is the marketing expert and strategist our company needs to grow our brand, technology, products and services in new directions, especially in the Internet and customer relationship management businesses. Mike is a strong leader with broad knowledge of the Internet, telecommunications and public policy that will propel our key strategic initiatives.”

“Equifax’s technology and information management capabilities are two best kept secrets,” Cummins said. “Equifax offers a unique combination of the resources and maturity of an established company coupled with Tom’s ‘new economy’ vision for its future.”

Prior to joining GCATT and Georgia Tech, Cummins was the Associate Dean for Academic Affairs and a member of the marketing faculty at the Goizueta Business School at Emory University. Before coming to Emory, Cummins served as the Associate Dean for External Relations and Associate Professor of Computer Information Systems at the University of Miami School of Business, where he founded the Master’s Program in Management Institute.

Cummins’ earlier career included a range of experiences spanning the three sectors of academia, business, and government. These included an appointment as Assistant Professor of Economics at Stanford University’s Graduate School of Business, serving as the Director of Strategic Planning for the international telecommunications satellite consortium, INTELSAT, and leading the development of a deregulation policy initiative for international telecommunications while Director of the International Facilities Planning Division at the Federal Communications Commission in Washington, DC.

Cummins received a bachelor’s degree from the University of North Carolina – Chapel Hill, and master’s and Ph.D. degrees in economics from Northwestern University.

Equifax (http://www.equifax.com ), a worldwide leader in shaping global commerce, brings buyers and sellers together through its information management, transaction processing and customer relationship management businesses. Atlanta-based Equifax serves the financial services, retail, credit card, transportation, telecommunications/utilities, information technology and healthcare industries and government. Equifax adds knowledge, expertise, convenience and security to provide value-added solutions and processes for its customers wherever they do business, including the Internet and other networks. Equifax employs more than 13,000 associates in 17 countries with sales in almost 50 and has $1.8 billion in revenue.

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Bangkok Transit Cards

Cubic Transportation Systems, a subsidiary of San Diego-based Cubic Corporation has launched a new mass transit fare collection system in Bangkok.

Cubic designed, built and installed the new system under a $23.7 million contract awarded three years ago by Siemens Transportation Group, the prime contractor for Bangkok’s mass transit rail system. The system utilizes Cubic’s most advanced magnetic ticketing technology for stored-value fare cards, which can be used over and over again simply by reloading value, and single journey tickets, favored by tourists and other non-commuters.

“The Bangkok project strengthens our presence in the Far East,” said Steve Shewmaker, senior vice president, business development for Cubic Transportation Systems. “It’s an example of Cubic’s global position as a technology leader and our commitment to meeting our customers’ unique fare collection requirements.”

Cubic delivered and installed 539 major pieces of fare collection equipment for the Bangkok system, including ticket issuing machines, barrier gates, station computers and analyzer/dispensers for agent booking offices. At the heart of the fare collection system is the Cubic-designed central computer, which integrates all the station equipment to a central source for revenue and data management.

Cubic’s other Far East projects include fare collection systems for Shanghai, Guangzhou, Hong Kong, Singapore, and Kuala Lumpur. The leading systems integrator in advanced magnetic and contactless smart card ticketing systems, Cubic’s customers include many of the world’s largest transit operators, including New York, London, Chicago, Washington, D.C., Seoul and Sydney.

The new Bangkok metro system, built by the Bangkok Mass Transit System Public Company Ltd., is the largest 100-percent privately financed turnkey metro project in the world. Built on an elevated track, the new Bangkok Transit System operates two lines that utilize 23 stations covering 14.5 miles (23.5 km).

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NYCE Expansion

NYCE has signed Sovereign Bank as a participant in the NYCE Network. Upon completion of the purchase of assets and deposits from FleetBoston Financial, Sovereign Bank will be a $35 billion financial institution with more than 600 community banking offices located from north of Boston to south of Philadelphia. Sovereign will add 500 ATMs and 770,000 ATM/debit cards to NYCE and is expected to be operational in the Network by the end of March. The Bank recently supplemented its electronic payments program in the Mid-Atlantic region with the acquisition of more than 550 ATMs in New England which were already participating in the NYCE Network.

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LINQ Calling Card Deal

LINQ Telecom, Inc., based in Fort Worth, announced an agreement Tuesday with Affiliated Foods Southwest.

The agreement outlines an exclusive partnership to provide calling cards to Affiliated member supermarkets and convenience stores.

“This is an exciting move by our sales and marketing group,” said Travis Hamer, president and CEO of LINQ Telecom, Inc. “Through our association with Affiliated, we see an opportunity to step up into an important segment of the demographic market. It also opens doors to all Affiliated distributors who service more than 1,000 stores in a seven-state area — Arkansas, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas.”

Reid Fitzgerald, vice president of sales and marketing for LINQ Telecom, Inc., says there is “no set value on the contract” at this time.

“However, we’re projecting a direct sales increase between $3 million and $5 million this year from the Affiliated contract,” he predicts. “We attribute this business deal to the brand equity we’ve built in this market over the past five years.”

John May, general manager of Sure Valu Stamp Company, a subsidiary of Affiliated Foods Southwest, says reliability influenced their decision to partner with LINQ.

“We were looking for a quality, reliable brand of calling cards to supply to our stores, and we believe the LINQ partnership will provide our customers with that service,” said May. “We’ve already received a positive response from store owners.”

LINQ Telecom, Inc., established in 1989, recently was recognized by Consumer Reports as the No. 1 service provider in the calling card industry for value and service. The company also was recognized last year by Intele-Card News as one of the top 10 companies to watch in 1999, and Telecom Business as one of the top 500 telecom firms in the world.

LINQ is a facilities-based telecommunications company that provides global long-distance services, primarily through calling cards. With offices in Fort Worth, Houston, San Antonio, El Paso, Denver, Chicago and Los Angeles, LINQ phone cards are available in retail locations throughout the United States, through distributors and online at [www.acculinq.com][1]. For additional information, visit LINQ’s Web sites at [www.linqtel.com][2] and [www.acculinq.com][3].

[1]: http://www.acculinq.com/
[2]: http://www.linqtel.com/
[3]: http://www.acculinq.com/

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Globeset CFO

Globeset, Inc., the world’s leading supplier of payment solutions for secure eCommerce, has appointed Duane W. Bell as Chief Financial Officer. Previously, Bell served as a Partner and Chief Financial Officer for KPMG Consulting, the consulting arm of KPMG LLP, a leading international public accounting and consulting firm. Bell also spent significant time on the firm’s merger and acquisition activities.

“Duane’s senior management experience with initial public offerings, mergers and acquisitions, will be instrumental in helping Globeset move to the next level,” said Michael Cation, CEO of Globeset.

Between 1988 and 1996, Bell held Chief Financial Officer and/or Chief Operating Officer positions with the technology consulting firm Cotelligent, the law firm of Buchalter, Nemer, Fields & Younger, and the engineering consulting firm Exponent. Prior to 1988, he was a tax partner with KPMG.

About Globeset

Globeset is the world’s leading software and services provider for the secure online payment infrastructure necessary to connect both buyers and sellers to their financial service providers. Globeset offers software products and services to the financial services industry, including banks, credit-card issuers and processors. Globeset also serves traditional software and service suppliers of the financial services industry and other participants in eCommerce, including portals and online merchants. The company’s products and services include electronic wallets and banking applications, and corporate applications, such as industry-leading electronic cash management system/automated cash management (e-CMS/ACM) software. For more information, visit the company’s Web site at: [http://www.globeset.com][1].

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

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AmSouth Joins PULSE

AmSouth Bank, one of the premier financial institutions in the Southeast United States, has joined the PULSE EFT Association, significantly expanding the network’s presence in that region.

Headquartered in Birmingham, Alabama, AmSouth last fall merged with First American National Bank, which was a PULSE member. Now all 660 branch banking offices will be displaying the PULSE brand and AmSouth ATM cardholders will be able to access their bank accounts through the network.

“The addition of AmSouth to the PULSE program is a significant step toward increasing PULSE’s operations and visibility in that part of the country,” said Leah Huffmeister, PULSE senior vice president. “With its recent acquisitions, AmSouth is one of the leading financial institutions in the Southeast, including Alabama, Tennessee, Mississippi and Louisiana, all states in PULSE’s primary service area.”

AmSouth Bancorporation began business operations in 1972 and has been involved in numerous mergers and acquisitions during the ensuing years.

Besides the switching and settling of ATM transactions, AmSouth officials are looking forward to taking advantage of the broad range of services that PULSE provides to its members.

“We have been impressed with PULSE’s strong commitment to providing outstanding service to its financial institution members and their customers,” said Greg Miles, AmSouth Bank senior vice president and manager of electronic banking. “We look at ATM cards as an important part of our strategy of providing convenience and service to our customers, and our affiliation with PULSE will strengthen that relationship.”

Mr. Miles is also a recent addition to the PULSE Board of Directors.

AmSouth Bank offers a complete range of consumer and commercial banking and trust services to businesses and individuals through branch banking offices in Alabama, Florida, Tennessee, Mississippi, Louisiana, Arkansas, Kentucky, Virginia and Georgia.

PULSE is a shared EFT network serving more than 2,100 banks, credit unions and savings and loans in a nine-state primary service area including Alabama, Arkansas, Colorado, Louisiana, Mississippi, New Mexico, Oklahoma, Tennessee and Texas. The network processes in excess of 40 million transactions monthly and features more than 52,000 ATMs and 229,700 PULSE(R) PAY point-of-sale terminals in all 50 states. For more information, visit the PULSE Web site at [www.pulse-eft.com][1].

[1]: http://www.pulse-eft.com/

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Metris New Ops Ctr

Metris Companies Inc. marked the grand opening of its new operations center in Tulsa, Okla., with a gala celebration.

Gov. Frank Keating, U.S. Rep. Steve Largent and Tulsa Mayor M. Susan Savage were expected to join Metris President and Chief Executive Officer Ronald N. Zebeck, other dignitaries, project partners and more than 800 employees for the event.

The new facility is at 51st and 129th streets in Tulsa. It consists of more than 100,000 square feet of space on three levels. The building currently houses Metris employees who work in customer service, collections and operations.

“The opening of our new Tulsa facility is another sign of the tremendous growth and success of Metris Companies,” Zebeck said. “We’re very proud of our new building and our reputation as an employer of choice in this market.”

To reinforce the company’s commitment to helping employees balance work and family issues, the new facility features a company-operated and subsidized Metris KIDS childcare center for employees’ children. The site also includes a company-subsidized cafeteria.

The Tulsa expansion marks one of several recent facility additions for the company, including new offices in Jacksonville, Fla., and Scottsdale, Ariz. Later this year, Metris will open a new corporate headquarters facility in suburban Minneapolis.

The new building is a project of Told Development. Manhattan Construction is the general contractor. The building was designed by Korsunsky Krank Erickson Architects, Inc.

Metris Companies Inc. is an information-based direct marketer of consumer credit products and fee-based services primarily to moderate-income consumers. Based in St. Louis Park, Minn., Metris also has operations in Jacksonville, Fla.; Champaign, Ill.; Baltimore, Md.; and Tulsa, Okla. It employs more than 3,100 people.

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