ATM & Cell Phone Vending

DebitFone International, a wholly owed subsidiary of SATX, Inc. announced Friday that they have signed a contract with Direct Connect, a division of Schwaz, LLC.

Direct Connect has been in the ATM business for many years with hundreds of operating ATM locations throughout Metro New York, New Jersey and Long Island.

Michael Schwartz, President and founder of Direct Connect stated “We have been looking for the right opportunity to expand our revenue base and DebitFone is a natural fit. Our ATM machines are located in proven high traffic areas that will provide tremendous exposure for the DebitFone vending machine. I’m looking forward to placing the first 1000 phones into our market as quickly as possible and generating the monthly residuals as a result of air time usage”.

Mr. Schwartz also stated, “It’s too early for us to project sales and revenues, however we are convinced that as a result of the impact on the economy made by cellular and other wireless products, DebitFone will allow us to participate in this ever growing revenue steam. People spend several minutes standing at an ATM machine completing transactions and now they will have the opportunity to purchase a cellular phone completely charged, ready to use with air time and no contracts to sign.”

Garry McHenry, VP Sales and Marketing for SATX, Inc. commented, “This contract is the result of negotiations over the past several months. It is just the first of the contracts we expect to sign before the end of the year.”


Messy Litigation

A lawsuit over cancellation of a merchant account is being aired in the news media. Los Angeles-based Voice Media, Inc., a provider of adult-oriented products and services over the Internet, filed a lawsuit against credit card processor XtraNet Systems, Inc. d/b/a DataBank International. XtraNet says it terminated the account on Nov. 30 due to excessive chargebacks and anticipated penalties upon VMI imposed under VISA and MasterCard regulations. VMI claims that XtraNet forged documents in banking relationships and mishandled more than $1.3 million dollars in reserve funds belonging to VMI, including the diversion of at least some portion of this money into offshore accounts. VMI’s lawsuit also claims multiple chargebacks and credits were issued by XtraNet against a single transaction which resulted in credits of thousands of dollars of activity in a single month, when the credits, if any, should have been in the tens of dollars. VMI alleges that XtraNet’s accounting irregularities is to blame for the dramatically increased chargeback ratios, as high as 8 to 20 times higher than normal that have produced $600,000 in chargeback penalties.


USPS Cash-Back

The United States Postal Service announced last week that debit card users can now make a cash withdrawal, up to $50, when conducting a postal service transaction, at any of the USPS 33,000 post office locations. The option has been available this year at most post office locations but was officially expanded to all locations last Wednesday. The USPS also announced that it now has expanded acceptance to include Diners Club, Carte Blanche and JCB International cards. The Postal Service began accepting credit cards in 1995 and in its first year generated 29.8 million transactions, representing $1.2 billion in purchases. Initially credit cards were accepted for all transactions including bulk mail services and postage meter loading, however after the first three months, the USPS limited usage to retail transactions. Last month, the U.S. Postal Service and KeyCorp launched a pilot program to deploy ATMs in post office lobbies in Maryland. The USPS says the ATM pilot may pave the way for eventually distributing Social Security payments, federal retirement payments, and other benefits via Post Office ATMs nationwide.


Return Policies Factor

Eighty-nine percent of online buyers say return policies influence their decision to shop with an e-retailer, according to a recent survey of 9,800 consumers by ([][1]), the Internet’s leading e-commerce merchant rating site and marketing research firm.

The post-holiday return rush is just around the corner and the focus for online retailers will shift from order fulfillment to processing returns. With 36 million orders forecast to be placed on the Web this holiday season, at least 5 percent of those orders are expected to be returned. At that point, the quality of return policies and customer support will become paramount in winning or losing customer loyalty.

“If online shopping is to continue the promise of convenience, merchants will need to pay close attention to building return policies that are customer friendly,” said Paul Bates, vice president of Information Products Group for “Online buyers tell us every day that the key to winning their loyalty is the level and quality of customer support.”

The survey also revealed that simply having a return policy is not enough. Consumers stated that the most important factor for an optimal online return policy would be a 100 percent money-back guarantee, followed by not being charged a fee to have the merchant restock the product.

Certain attributes of return policies can actually drive potential customers away. These include the inability to receive credit on a credit or debit card (85 percent) followed by a time limit to return products that is “too short” (68 percent). Other attributes that online buyers consider important are whether the merchant allows products to be returned by mail (66 percent) and the ability to exchange a product for another item (58 percent). Sixty-two percent of consumers said they would prefer to return products by mail instead of traveling to a brick-and-mortar store.

Other findings include:

— Refunds (59 percent) ranked as the leading form of action taken on returned products followed by exchanges (27 percent) and credit at an offline or online store (11 percent).

— The three leading products returned were clothing (27 percent), computer software (20 percent) and books (15 percent).

— An overwhelming majority (92%) of respondents would be inclined not to do business with online merchants who imposed a service charge to return a product to an offline store.

— 71 percent said that if they purchased a tax-free item online, they would not exchange it at a retailer’s offline store if a sales tax were imposed on the exchange.

— 94 percent of returns were mailed back to the online retailer versus returned to an offline store.

— 73 percent of those surveyed said that return policies for online stores are comparable to returning items purchased through a catalog.

— On average, survey respondents had returned only one to two items purchased online during their individual personal histories of Internet shopping.


Founded in 1996, is an unbiased, independent rating guide built on the experience of millions of actual online buyers. The site combines valuable consumer information with a powerful set of shopping tools that help people find the store or product they want, as well as offers recommendations based on user-specified criteria. is the only company trusted by more than 2,700 e-businesses to collect this direct consumer feedback and transactional information at the point of purchase. The online store performance ratings, derived from this data, denote the only statistically rigorous way of differentiating retailers on “quality of service” metrics. information also appears on Consumer Reports Online and in Consumer Reports magazine, as well as through top Internet portals such as AltaVista, Go2Net, Go Network, Microsoft Networks and Snap.



Credit Card Bills Online

At least one out of five bills sent to consumers, will be delivered electronically the year 2005. The delivery of credit card bills electronically will lead the way as many card issuers migrate rapidly to electronic bill presentment and payment services via the Internet. Last week GE Capital announced it is working with edocs to deliver online billing capabilities to its 300 private label credit card corporate clients representing over 100 million accounts worldwide. Other major card issuers are also exploring or piloting electronic delivery. This weekend, Tampa, FL-based PSI Global released a report that projects EBPP transactions will grow more than 200 times their 1999 level to a total of nearly 5 billion bill payments. PSI says once Y2K issues are resolved and resources are freed-up, they expect to see an increasing number of billers turning their focus to EBPP. Just 5% of the high-volume billers in the US currently offer EBPP, and 24% say they plan to offer the service within the next two years. PSI Global’s research indicates that bill volume in the US will reach nearly 18 billion items this year, while bill payment volume will climb to 23 billion. A vast majority of these transactions represent interaction with the insurance, communications, credit card, lending, and utilities sectors. Research performed by PSI Global shows that electronic transactions will account for just over 1.5 billion items or 7% of all bill payments this year with most using ACH.


Bank One Shareholder Suit

The following was released Fiday by Wechsler Harwood Halebian & Feffer LLP:

Notice is hereby given that on December 14, 1999, a securities class action lawsuit was filed in the United States District Court for the Northern District of Illinois against Bank One Corp. (“Bank One”) (NYSE:ONE), First USA, and certain officers and directors of Bank One and First USA on behalf of all persons and entities who purchased the stock of Bank One during the period October 22, 1998 and November 10, 1999, inclusive (the “Class Period”).

The complaint alleges that defendants violated the federal securities laws, including Sections 10(b) and 20 of the Securities Exchange Act of 1934, as amended, by making false and misleading statements in press releases and filings with the Securities and Exchange Commission, concerning, among other things, the business, financial condition, earnings and prospects of Bank One and its wholly-owned subsidiary, First USA. Specifically, the Complaint alleges that Bank One achieved its financial results from First USA’s improperly recorded revenues from late fees, penalties and interest by failing to post credit card payments on time.

After a series of partial disclosures beginning on August 24, 1999, and ending on November 10, 1999, the facts concerning defendants’ conduct became widely known, including a report that First USA was the target of an investigation by the Office of the Comptroller of the Currency, the stock price of Bank One plummeted from its Class Period high of $63.563 per share to close at $34.625 per share on November 10, 1999.

Plaintiff is represented in this class action by the New York law firms of Wechsler Harwood Halebian & Feffer LLP and Bull & Lifshitz, LLP, both of which have extensive experience representing shareholders in class actions.

If you purchased Bank One common stock during the Class Period, you may, not later than 60 days from December 17, 1999, move the court to serve as a lead plaintiff, provided you meet certain legal requirements.

If you wish to discuss this action, or have any questions concerning this notice or your rights or interests with respect to this matter, please contact:

Wechsler Harwood Halebian & Feffer LLP, 488 Madison Avenue, New York New York 10022 Robert I. Harwood, Esq., Jeffrey M. Haber, Esq. or Frederick W. Gerkens, III, Esq., Telephone: 1-877-935-7400 (toll free), or Wechsler Harwood’s Shareholder Relations Department, Shannon Cooper, e-mail:


MasterCard E-Mail

MasterCard has expanded ‘MasterCard Exclusives’ to an online program. Starting today MasterCard cardholders can now specify the type of special offers they are looking for and receive personalized email updates on special ‘MasterCard Exclusives’ offers. MasterCard will also use the email channel to notify registered cardholders of sweepstakes, promotions and special events. In addition to specifying the categories of offers desired, registrants may also indicate how often they want to receive MasterCard updates: monthly, bi-monthly or quarterly. To register, MasterCard requires cardholders to specify name, zipcode, age and gender. MasterCard also requests applicants to indicate the issuer of their “most used” MasterCard. Among current ‘MasterCard Exclusives Online’ offers: 20% off all products at Flowers USA; 20% off purchases at Beauty Cafe; and 20% off all purchases at According to CardWatch ([][1]), MasterCard announced the new program in a full page ad in this morning’s Wall Street Journal.


[2]: /graphic/mastercard/exclusives_online.gif


Discover Card Preferred

Discover Financial Services, Inc. announced an agreement with Mills Corporation that makes Discover Card the preferred credit card at nine of Mills’ retail and entertainment destinations across the country.

As part of the agreement, Discover Card will conduct promotions, display signage, run advertising on Mills TV and establish a joint website presence with The Mills. In addition, Mills’ consumers will have the opportunity to receive a Discover exclusive coupon book by simply presenting their Discover card at the information booth. The book will offer exclusive values for Discover Cardmembers and include discounts with merchants such as Samsonite, Wilsons Leather, Burlington Coat Factory, Mikasa Factory Store, Nine West Outlet, Off Rodeo Drive Beverly Hills, OshKosh B’Gosh, Urban Planet, and Vans.

Participating Mills centers include:

Potomac Mills — Prince William, Va. (Washington, D.C.)

Franklin Mills — Philadelphia, Pa.

Sawgrass Mills — Sunrise, Fla. (Ft. Lauderdale/Miami)

Gurnee Mills — Gurnee, Ill. (Chicago)

Ontario Mills — Ontario, Calif. (Los Angeles)

Arizona Mills — Phoenix, Ariz.

The Block at Orange — Orange, Calif.

Concord Mills — Concord, N.C. (Charlotte)

Katy Mills — Katy, Texas (Houston)

Mills’ customers will also benefit from quarterly promotions that will run in conjunction with Discover Card’s national marketing campaigns. A recent opportunity was the Cashback Bonus Countdown Tour, which took place at various malls this fall. During the Cashback Bonus Countdown Tour events, a photo of each shopper was taken in front of a replica of Times Square featuring Discover Card’s electronic billboard. These photos will be broadcast on the Discover Card Times Square sign during the weeks leading up to New Year’s Eve. Discover Card’s Cashback Bonus Countdown Tour was held in conjunction with Discover Card’s Cashback Bonus(R) Countdown Sweepstakes, in which Discover Card will award $1 million to one lucky winner at the Times Square New Year’s Eve celebration.

“Discover Card is looking forward to working with Mills Corporation to help increase brand awareness and usage among Cardmembers,” said Cathy Davis, vice president, advertising and brand management, Discover Financial Services, Inc. “This partnership will result in a more rewarding shopping experience for our Cardmembers and consumer savings at some of the nation’s biggest retail and entertainment properties.”

Tony Wells, Vice President, Partnership Marketing and Sales for The Mills Corporation adds, “Our partnership with Discover Financial Services will provide consumers with unique merchant value offerings maximizing the positioning of both The Mills’ and Discover brands. With over 130 million visitors each year, The Mills provides a competitive edge for Discover to gain a greater share of wallet. Mills marketing opportunities are unmatched in the industry.”

Discover Financial Services, a business unit of Morgan Stanley Dean Witter & Co., operates the Discover Card brands with more than 47 million Cardmembers and the Discover/Novus(R) Network. The Network is the largest independent credit card network in the United States with more than 3.5 million merchant and cash access locations.

The Mills Corporation (NYSE: MLS) is a self-managed real estate investment trust (REIT) based in Arlington, Va., that owns, develops, leases, manages and markets a portfolio of ten market dominant retail and entertainment destinations (nine Mills and one Block), and 11 community shopping centers. Combined, Mills’ projects total approximately 16.8 million square feet in 13 states. Mills will celebrate the grand opening of its newest project, Opry Mills, in Nashville, TN on May 11, 2000. Currently, the company has six projects under construction and/or development in the United States and one in Toronto, Canada. The company’s Internet address is [][1].



Privacy Committee

The Federal Trade Commission announced Thursday it is looking for 30 industry members to form an Advisory Committee on Online Access and Security. Providing consumers access to information collected about them and providing security for such information are two of five core fair information practice principles described in the FTC’s consumer privacy report to Congress. The Advisory Committee will provide advice and recommendations to the Commission regarding options for the implementation by commercial Web sites of the access and security information practice principles, and the costs and benefits of each option. The committee will consider, among other things, whether the extent of access provided by Web sites should vary with the sensitivity of the personal information collected and/or the purpose for which such information is collected; whether the difficulty and costs of retrieving consumers’ data should be considered, whether consumers should be provided access to enhancements to personal information (e.g., inferences about their preferences or purchasing habits); appropriate and feasible methods for verifying the identity of individuals seeking access; whether a reasonable fee may be assessed for access, and if so, what a reasonable fee would be; and whether limits could be placed on the frequency of requests for access, and if so, what those limits should be. The Advisory Committee will also consider how to define appropriate standards for evaluating the measures taken by Web sites to protect the security of personal information; what might constitute reasonable steps to assure the integrity of this information; and what measures should be undertaken to protect this information from unauthorized use or disclosure. The first meeting is scheduled for Feb. 4, 2000.


FDC Hires Fleet

First Data Corp. has created a new position to support both its card issuing and merchant processing lines of business to lead the development and growth of emerging products and services. Steve Van Fleet, a 20-year veteran of the payments business, has joined First Data Corp. as senior vice president across both First Data Resources and First Data Merchant Services.

In this role, Van Fleet is responsible for identifying new opportunities and implementing plans to leverage the strengths of both FDR, the global leader in card transaction processing and card portfolio management services for over 1,400 card issuers, and FDMS, one of the nation’s leading providers of electronic commerce solutions for hundreds of financial institutions and nearly two million businesses.

At First Data, Van Fleet’s specific focus will be on developing, implementing and managing products and services that utilize smart card technology, debit, and other emerging electronic payment technologies. He will report to both El Adams, president of FDMS and Todd Strobe, managing director, FDR.

“First Data’s organizational goal has been to create a unified company with all of our people working together to achieve our strategic objective: To process every electronic transaction worldwide from the point of occurrence to the point of settlement,” said Ric Duques, First Data chairman and chief executive officer. “Under Steve’s direction, this cross-unit function will help us maximize our efforts and provide our clients with the most comprehensive payment solutions in the industry.”

Over the past year, First Data has focused on creating a shared services infrastructure to facilitate the exchange of ideas and resources across subsidiaries and continue the move toward a more customer-centric environment. Van Fleet’s appointment follows a recent announcement by First Data about its creation of an Internet Commerce Group to spearhead Internet Electronic Commerce payment solutions and related initiatives working across all First Data subsidiaries.

“As the boundaries of commerce continue to expand, enabling financial institutions and merchants to conduct business electronically, from processing and safeguarding transactions to collecting and maintaining purchasing information, First Data intends to strengthen its leadership position as the premier provider of payment solutions. By leveraging strengths across First Data’s subsidiaries, the company can provide an unparalleled set of solutions for its clients,” Duques said.

Van Fleet most recently served as a senior vice president at MasterCard International where he was responsible for management of all U.S. consumer products including credit cards, debit cards, chip (stored value and loyalty), remote commerce and remittance processing. Previously, he was general manager for MasterCard’s Global Deposit Access Products, which included the Cirrus global ATM network. He received a juris doctorate from DePaul University, a master’s degree in business administration from the University of Houston and a bachelor’s degree in business and marketing from Northern Arizona University.

Atlanta-based First Data Corp. (NYSE: FDC) helps move the world’s money. As the leader in electronic commerce and payment services, First Data serves more than two million merchant locations, 1,400 card issuers and millions of consumers, making it easier, faster and more secure for people and businesses to buy goods and services. With more than 33,000 employees worldwide, the company provides credit, debit and stored-value card issuing and merchant transaction processing services; Internet commerce solutions; money transfers and money orders; and check processing and verification services throughout the United States, United Kingdom, Australia, Mexico, Spain and Germany. In addition, its Western Unionr network includes approximately 78,000 agent locations with operations in 176 countries. For more information, please visit the company’s web site at [][1].