U.S. Bank Woes

Consumer class action specialist Wolf Popper LLP announced late Friday that it has filed a lawsuit in the U.S. District Court for the District of Minnesota on behalf of all credit card customers of US Bancorp. The suit follows the filing of a lawsuit last week by the Minnesota Attorney General’s Office against US Bancorp. The Attorney General’s office alleges that US Bancorp sold financial information to MemberWorks in violation of the federal Fair Credit Reporting Act and various state laws designed to protect consumers. The AG suit also alleges that US Bancorp engaged in consumer fraud and deceptive advertising. Wolf Popper says the action brought by the Attorney General of Minnesota was brought solely on behalf of affected residents of the State of Minnesota and does not cover US Bancorp customers in 17 other states.

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CyberCash Takes Extensity

Extensity, Inc., a leading provider of Internet applications for e-business employees, announced that CyberCash, Inc. (Nasdaq: CYCH) has chosen Extensity(TM) Expense Reports to help streamline their travel and entertainment expense reporting process. CyberCash, a leader in e-commerce technologies and services, will implement the Web-based solution to manage and automate expense reporting for business travel in the U.S. and abroad, replacing the discontinued ADP Expense solution previously in use. Extensity Expense Reports is part of Extensity’s suite of e-business applications, which help enterprise customers use the Internet to transform business processes to achieve maximum operational efficiency and optimal financial performance.

CyberCash selected Extensity Expense Reports following a competitive review of several expense reporting solutions currently on the market. The application will enable CyberCash to streamline and automate expense reporting for both domestic and international travelers, while reducing business travel costs through improved process integration, better centralized control of travel practices, and more efficient approval and auditing procedures. Said CyberCash Director of Finance Jeffrey Yentis, “Following an extensive evaluation of our options, we found Extensity Expense Reports to be the most elegant product on the market. Extensity’s systems administration tool eliminates the maintenance hassles associated with most applications of this type, and lets us deploy a great solution at a low total cost of ownership.” Yentis also cited as a key consideration Extensity’s comprehensive reporting capabilities, which enable customers to keep a close eye on travel costs and negotiate favorable terms with travel vendors.

Extensity Expense Reports lets travelers complete expense reports using an intuitive browser-based interface that can be accessed online or offline for greater convenience. Reports are checked for business rule compliance at the point of entry, audited automatically according to customer-specified parameters, routed to managers for approval, then fed seamlessly into the customer’s existing financial system. The application’s Web-based architecture centralizes administration for a high level of control, while its browser-based interface streamlines maintenance and provides extensive scalability. Extensity Expense Reports integrates seamlessly with Extensity Travel Plans, which automates the travel planning and approval process, to form the Extensity Business Travel, an end-to-end solution for automating the entire travel planning, approval, and expense reporting process.

“Extensity’s applications are designed to help companies support their employees as efficiently and cost-effectively as possible,” said Extensity President and CEO Bob Spinner. “Extensity Expense Reports makes it simple and convenient for travelers to prepare expense reports wherever and whenever they need to, while giving their companies the tools they need to keep their business travel processes running smoothly.”

About CyberCash

CyberCash is a world leader in e-commerce technologies and services, enabling commerce across the entire market spectrum from electronic retailing environments to the Internet. CyberCash provides a complete line of software products and services allowing merchants, billers, financial institutions and consumers to conduct secure transactions using the broadest array of popular payment forms. Credit, debit, purchase cards, cash, checks, smart cards and alternative payment types (e.g., “frequent buyer” or loyalty programs) are all supported by CyberCash payment solutions. Leading brands of CyberCash include ICVERIFY(R), PCVERIFY(TM), CashRegister, NetVERIFY(TM), PayNow(TM), and InstaBuy(TM). For more information on CyberCash, go to .

About Extensity

Extensity is pioneering the development of a suite of e-business applications that help customers leverage the Internet to radically transform the way they do business. Extensity applications automate business processes for employees to help corporations optimize productivity and better manage costs. Established by Scopus Technology co-founder Sharam Sasson, Extensity is funded by premier venture backers including Hummer Winblad Venture Partners, Kleiner Perkins Caufield & Byers’ Java Fund, Weiss, Peck & Greer Venture Partners, and Visa International. Extensity customers include Franklin Resources, Incyte Pharmaceuticals, Nationsbanc Montgomery Securities, Reltec, and the @Home Network. For more information on Extensity, go to .

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Net.Bank Doubled

Net.B@nk, Member FDIC (http://www.netbank.com), the largest FDIC-insured bank operating solely on the Internet, has more than doubled its account base since January 1, 1999 from more than 17,000 to over 35,000, CEO D.R. Grimes announced Friday. Grimes attributed the growth to the success of the bank’s new marketing and branding strategy, its high-yielding, low-fee deposit products and its superior customer service.

Net.B@nk launched a new advertising campaign in February, which highlights the cost savings Net.B@nk achieves as an Internet bank and how those savings are translated into high-yielding, low-fee deposit products for its customers. The bank’s customer service was recently highlighted in a survey of online bank customers conducted by Gomez Advisors — Net.B@nk ranked #1 for customer relationship services.

“Net.B@nk has clearly demonstrated that the Internet is a viable and widely accepted delivery channel for banking as we continue to experience unprecedented growth compared to traditional banks,” said Grimes. “We set the standard for Internet banking by providing customers with a complete line of web-based products and services, giving customers the ultimate one-stop banking and financial services site.”

Net.B@nk’s unmatched NetValue Checking account, which bears 3.05% APY with no service charge and requires only $100 to open the account, is attracting a sizable number of new customers. As a pure Internet bank with no branches, Net.B@nk has dramatically lower costs and fewer employees than traditional banks. Net.B@nk has maintained its commitment to pass along those savings to its customers. Net.B@nk offers customers a compelling value with a well-rounded product line currently featuring FDIC-insured, interest-bearing deposit products, online bill payment, online mortgage services, and non-bank financial services, including online brokerage services and business equipment leasing. Later this year, Net.B@nk will offer home equity loans and automobile loans with real-time approvals, call center support, and fast closings. Net.B@nk also plans to roll out insurance products, online bill presentment and virtual safe deposit boxes.

“We are providing free, high-interest checking with unlimited online bill payment services, no monthly minimums and no monthly service charges — not to mention unlimited account access 24 hours a day, 7 days a week,” added Grimes. “Two-career families today have an increased need for convenience and cost savings and we are accommodating that as online banking grows.”

Some industry analysts report that total U.S. online banking households almost doubled to 8 million during 1998 and project that number to nearly triple to 25 million by year-end 2001. As of March 31, 1999, Net.B@nk, Inc. reported $526 million in assets with $333 million in deposits. The company has been profitable for the past four successive quarters.

Net.B@nk, Inc. is a financial services company whose sole subsidiary, Net.B@nk, Member FDIC, is the first profitable Internet-only bank in the country, having achieved profitability in the past four successive quarters. With more than 35,000 accounts and customers in all 50 United States and 20 foreign countries, Net.B@nk is the largest FDIC-insured bank operating solely on the Internet. In addition to checking and money market accounts and certificates of deposits with exceptional interest rates, Net.B@nk offers its customers the ultimate convenience in banking. Products and services include account access any time, anywhere, free unlimited online bill payment, free unlimited ATM use, VISA(R) Check Card, VISA(R) and MasterCard(R) credit cards, online brokerage services, mortgage lending and business equipment leasing services. For more information on Net.B@nk, its products and services, visit the web site at , or call 888-256-6932.

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Visa Business

CA- based software developer IMSI Thursday announced that a number of its top products are included on VISA International’s new Visa.com list of ten “World’s Best for Business” offers. VISA cardholders will receive a 20% discount when they use their ‘VISA Business Card’ to purchase ‘TurboCAD 2D’, ‘NetAccelerator 2.0’, ‘MasterClips 303,000’ or ‘FloorPlan 3D Design Suite’.

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NextCard’s Top Score

NextCard yesterday announced that its Affiliate Network has been named one of the top ten affiliate programs on the Web by Refer-it.com. With over 12,000 active affiliates, the NextCard Affiliate Network is the largest affiliate network for a financial institution. Refer-it.com, the leading search engine for affiliate programs, has awarded the NextCard Affiliate Network a perfect 3 star rating for excellence in every category, including efficient online reporting, customizeable content, superior customer service, easily navigated user interface and substantial revenue sharing. NextCard offers a minimum of $20 for each new account booked through an affiliate site, and provides a huge selection of banners and buttons to use in promoting the NextCard Internet Visa on Web sites.

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EDS – TNB – CU

TNB Card Services, a subsidiary of Dallas-based Town North National Bank, has contracted with EDS for image-based payment processing for its credit card receivable payments. The multiyear outsourcing agreement includes remittance processing through EDS’ ‘Remittance Network’ in addition to current services that include the ‘BMIS’ retail banking product, back-office operations and Internet banking, which EDS already provides for Town North. ‘Remittance Network’ is a client/server, Intel-based, Windows NT 4.0 system that processes 90 million remittance transactions on behalf of EDS clients each year. The processing services are enhanced by ‘EDS*PAY Concentration Services’. These services allow TNB Card Services to electronically receive payments originating from more than 6,000 home banking applications and credit counseling agencies.TNB Card Services was formed in 1975 by a group of credit unions and has more than 400 customer credit unions across the Southwest issuing VISA/MasterCards to three million members.

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MerchantOnline

MerchantOnline.com Thursday announced that it has signed an agreement with NY-based Fine Point Technologies to be the exclusive provider of e-commerce services. MerchantOnline.com will market its e-commerce services to Fine Point’s Total Internet clients, which combined have purchased more than 1 million Total Internet end-user licenses. Services provided by MerchantOnline.com under the agreement include real-time credit-card processing and MOL-e-check transactions online, utilizing the MerchantOnline.com front- and back-end processing network.

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Siemens Pilot

FL-based Siemens Information and Communication Networks unveiled yesterday its largest-ever smart card pilot program to manage health information and simplify administration of the state’s health and food benefits. The ‘Health Passport Project’ will be rolled out over the next four months across three Western communities in ND, WY and NV. The first application of the ‘Health Passport’ will be initially targeted at pregnant women, mothers and children in the pilot communities who are eligible for a number of public health programs, including Medicaid; Immunization; WIC; Head Start; and Maternal and Child Health Services. Open Domain of San Ramon, CA is programming the smart cards and and Louisville, KY-based Stored Value Systems is responsible for the WIC EBT application. Computer chips from Siemens’ Infineon Technologies are being used in the smart card devices.The program will be formally presented to the governors of 11 other states next week.

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Piling On

Providian was hit with another lawsuit yesterday in the wake of widespread consumer complaints over its credit card practices. The Seattle office of the law firm of Cohen, Milstein, Hausfeld & Toll filed a lawsuit last week in the Superior Court of the State of California for the County of San Francisco on behalf of Providian credit card holders. Lieff, Cabraser, Heimann & Bernstein of San Francisco is also representing Providian credit cardholders. The suit alleges, among other things, that Providian has extracted unlawful, excessive late charges and other penalties from its credit card holders for unwanted “credit protection” insurance and other hidden fees. Last week shareholder litigation specialist Wolf Popper filed a class action lawsuit on behalf of Providian shareholders. All the suits are in reaction to an investigation by the San Francisco District Attorney’s Office into Providian’s credit card practices. News of the suit broke May 20 in the San Francisco Chronicle and CardTrak/CardFlash. Providian’s stock slid more than 40% since the news broke however it has moderated this week, closing yesterday at 83 1/8.

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Credit Store

The Credit Store, Inc. announced that it completed its third securitization of performing credit card receivables. The transaction involved the sale of approximately $6.2 million in seasoned credit card receivables to a wholly-owned qualified special-purpose corporation, TSC Funding III, Inc., that was established for this transaction. The receivables were fully current and had been seasoned in excess of eight months.

This transaction was funded, in part, by a $4.0 million term loan from Miller & Schroeder Investments Corporation of Minneapolis, MN. The excess of the purchase price for the receivables over the cash proceeds will be retained by The Credit Store as a capital contribution to TCS Funding III. The Credit Store will continue to service the credit-card receivables sold to TSC Funding III on a fee basis. The Credit Store completed similar securitizations in Sept. and Dec. 1998, for approximately $6.5 million and $7.8 million in credit card receivables respectively.

Martin J. Burke III, chairman and chief executive officer commented: “We are pleased with this, our third transaction, which demonstrates a growing market for our performing credit card assets. Our first two securitized transactions continue to perform well within modeling parameters. We believe we are demonstrating the continued saliency of our business plan and are well on our way defining a new niche in the consumer credit marketplace.” The Credit Store, Inc. is a nationwide financial services company engaged in the acquisition and collection of non-performing consumer receivables and the origination and servicing of credit cards. The Company acquires portfolios of non-performing consumer debt at substantial discounts, and then uses its direct marketing expertise to contact and negotiate settlements with consumers, most of the time placing settlement on new unsecured credit cards offered through The Credit Store.

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EFT – Next Generation

Twenty-three workshops, keynote addresses and breakout sessions highlight this year’s EBT–The Next Generation, a three-day national conference on the future of Electronic Benefits Transfer Systems. The EBT Industry Council of the Electronic Funds Transfer Association hosts the annual conference.

In announcing this year’s agenda, EFTA Executive Director H. Kurt Helwig said, “EBT–The next generation may be the most thorough compendium of information on EBT ever presented at one time.”

The conference scheduled for November 7-9 in Washington, DC, will include two tracks of workshops for both beginning and advanced EBT practitioners, said Helwig. These include sessions on retail technology and the art of marketing high-technology projects.

Breakout session topics include government electronic commerce, non-US EBT applications, a debate on online v. offline EBT applications, and separate biometrics sessions covering both technology and applications for EBT. Helwig noted that this year’s conference will include a number of sessions on EBT and retailing, such as Retailers and Technology, Retailers’ Views on the Next Generation of EBT, Point-of-Service Integration, Advanced Transaction Technology, and Advanced Card Technology.

About EBT–The Next Generation

EBT-The Next Generation is an annual conference devoted to the business, technology and policy issues of using advanced electronic technology for the delivery of government funds and services. This year’s conference, to beheld at Washington’s Madison Hotel, is expected to attract several hundred people.

About the EBT Industry Council

The EBT Industry Council is the nation’s longest standing trade group dedicated to the business and policy issues of Electronic Benefits Transfer systems and technology. Its members include Citicorp Services, Inc., Deluxe Electronic Payment Systems, Concord EFS, and Network Decisions, Inc.

About the Electronic Funds Transfer Association

Now in its third decade, the Electronic Funds Transfer Association provides inter-industry leadership for the advancement of electronic payments systems and commerce. Its members include Visa, MasterCard, American Express, Discover, and virtually all shared ATM systems in the country. Its Web site, efta.org, contains a full list of members and more information.

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