Cert Authority Gets Gov Approval

CertCo’s(TM) Certification System has been designated as eligible for procurement under the recent Broad Agency Announcement for the Key Recovery Demonstration Project (BAA), CertCo announced today. An interagency evaluation panel coordinated by the National Institute of Standards and Technology on behalf of several U.S. government agencies and departments approved CertCo products and services for use in government public key infrastructure and key recovery pilots related to the BAA project. Federal agencies will be able to procure CertCo products under the project until July 10, 1998.

The use of CertCo’s products will enable government agencies to issue digital signature certificates directly to their employees or to entities with which they conduct business. CertCo’s products offer the highest commercially available security through the use of key-splitting and distributed management and control techniques.

Potential applications include: limiting access to databases to authorized individuals or other computers. Providing authentication and non-repudiation for electronic transactions is critical for today’s world. Technology increases the management audit control process for automated and electronic transactions that substitute for paper documents and signatures in automated communications. Use of this technology facilitates the electronic handling of business transactions including bids, legal filings, travel vouchers, medical file security, confidential e-mail, and on-line purchases and money transfers.

CertCo’s Certification Authority is the technology previously selected to provide the root Certification Authority for the Secure Electronic Transactions (SET) infrastructure being implemented by MasterCard and Visa for Internet credit card transactions.

CertCo’s technology utilizes a secure split-key cryptography method called distributed Multi-Step Signing(TM), and tamper-resistant/tamper-evident hardware devices. These sophisticated cryptographic systems meet government and industry standards, and integrate with user applications to add trust, efficiency and security required for the World Wide Web and global network applications. As use of the Internet grows, financial transactions and other secure exchanges requiring authentication, non-repudiation and confidentiality will increasingly rely on public key infrastructure components provided by CertCo.

“Government agencies have long been aware that the use of open electronic commerce systems would allow them to eliminate paper, reduce costs, and improve responsiveness,” Ed Appel, Vice President of Government Relationships at CertCo, said. “Serious concerns about confidentiality and security have delayed widespread deployment of cost-effective solutions. The use of CertCo’s certification authority technology eliminates these roadblocks by assuring the integrity and security of transactions conducted on publicly- accessible systems. Federal agencies now have a green light to get on the information superhighway.”

CertCo, a leader in trustworthy electronic commerce, provides integrated business systems to establish the global trust infrastructure necessary to support rapid growth for electronic commerce. The company integrates its experience in cryptography, risk management, law, technology and banking, with its accomplished management team, to deliver fast, cost effective, electronic commerce business solutions.

CertCo’s technology enables banks, other financial institutions and government agencies to build a trust infrastructure to support large-scale, international, secure electronic commerce. Spun out from Bankers Trust in 1996, CertCo is headquartered in New York City, with regional offices in Albuquerque, NM, Cambridge, MA, Salt Lake City, UT, Washington, DC, and has representatives in the United Kingdom.

CertCo and Multi-Step Signing(TM) are trademarks of CertCo LLC. All other trademarks are the property of their respective companies.

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AmSouth Licenses S1 Solution

Security First Technologies (S1), a wholly owned subsidiary of Security First Network Bank (Nasdaq: SFNB), announced today it has licensed its Internet banking solution to AmSouth Bank (NYSE: ASO), one of the Southeast’s premier banks with total assets exceeding $18 billion. AmSouth will use S1’s Internet solution, Virtual Financial Manager(TM) (VFM), to offer Internet banking as an exciting additional alternative delivery channel for their customers, expanding on AmSouth’s existing direct dial PC banking offering.

AmSouth will initially deploy Virtual Bank Manager(TM) (VBM) and Virtual Credit Card Manager(TM) (VCCM), the first two components available within S1’s VFM suite of Internet banking and financial services software applications. Furthermore, AmSouth also will utilize the S1 Internet data processing and customer service center in Atlanta. VBM and VCCM will allow AmSouth’s customers to access their accounts via the Internet without the use of any specific software except a secure browser. Funds transfer and bill payment transactions will be conducted in a real-time environment which will ensure synchronization with other remote access devices, such as the VRU and PC software.

“AmSouth strives to offer its customers not only the most complete array of financial products and services, but also the greatest convenience to those products and services,” said Grayson Hall, Executive Vice President, Operations and Technology at AmSouth Bank. “As a result of our agreement with Security First Technologies, we will be able to provide our customers with secure, round-the-clock access to their accounts over the Internet from any location that has a secure browser.”

“As use of the Internet continues to grow, we are proud to be providing one of the nation’s top 50 financial institutions, AmSouth Bank, with a proven, secure, scaleable solution to meet their customers’ needs for greater convenience in conducting personal financial transactions,” said James S. Mahan, III, Chairman of Security First Technologies. VBM and VCCM will allow AmSouth’s Internet enabled customers to access over a year’s worth of account information. According to Mahan, AmSouth will also be one of the first financial institutions in the country to provide the functionality and benefits over any access point to the Internet, that consumers usually find only in PC based, personal financial management programs such as Quicken and Money. Finally consumers aren’t forced to bank only on one PC. They can pay bills, review expenses, receive their credit card statement, open accounts and generate summary reports of their financial transactions from home, at work, while traveling, or even in a Cyber Cafe.

About Virtual Bank Manager (VBM)

VBM allows financial institutions’ customers to open accounts or Internet enable existing accounts over the Internet. Customers can pay bills electronically, transfer funds between accounts, review automatically reconciled check registers and statements, generate and customize reports to track expenses and purchases, and download account information into personal financial management (PFM) software packages. Customers can also interact with customer service representatives via e-mail. And because S1 provides a Web-based solution, Internet banking customers are able to access their accounts from anywhere in the world using any secure, Internet-enabled device, including computers and personal digital assistants, as well as future secure browser devices such as WebTV and Web phones.

About Virtual Credit Card Manager (VCCM)

VCCM allows financial institutions’ customers to access current credit card balances, and payment and transaction history information over the Internet. Used in conjunction with VBM, VCCM links credit card data to other Internet accounts, which allows customers to pay their credit card bills instantly from their Internet checking accounts. They can even schedule payment of their monthly credit card bills — either minimum balance, entire balance, or a specified amount — to occur automatically on the due date. In addition, VCCM’s electronic bill presentment capabilities allow customers to view current posted credit card transactions online at anytime (including transactions from past and future billing cycles) and transaction categories help them track their spending.

About AmSouth

Headquartered in Birmingham, Alabama, AmSouth is a regional bank holding company with assets of $18.1 billion, ranking it among the top 50 banking institutions in the U.S. AmSouth operates 275 banking offices and more than 600 ATMs in Alabama, Florida, Tennessee and Georgia. AmSouth and its subsidiaries provide a full line of traditional and nontraditional financial services including consumer and commercial banking, mortgages, trust services and investment management.

About Security First Technologies (S1)

Security First Technologies () is a wholly-owned subsidiary of the world’s first Internet bank, Security First Network Bank (NASDAQ: SFNB). S1 provides an integrated suite of financial management applications designed to help financial institutions offer products and services online in a secure environment. S1 also offers business and network security consulting, training services, product integration, and data and customer service center outsourcing.

About Security First Network Bank

Security First Network Bank, the world’s first Internet bank, opened its doors to the Internet community on October 18, 1995. FDIC-insured SFNB provides its services using Virtual Financial Manager (VFM), a software system created by and licensed through its wholly-owned subsidiary Security First Technologies (S1). Utilizing a multilayered security platform also developed by S1, SFNB’s online transactions are protected by the same trusted operating system technologies used by the U.S. Department of Defense and other military intelligence agencies.

Virtual Financial Manager, Virtual Bank Manager and Virtual Credit Card Manager are trademarks of Security First Technologies (S1).

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PaySys IPO

PaySys International, Inc., announced today that it has filed a registration statement with the Securities and Exchange Commission for an initial public offering of 3.3 million shares of common stock.

The offering will include 2,083,333 shares offered by PaySys and 1,250,000 by selling shareholders. An additional 500,000 shares may be sold upon the exercise of the over allotment option granted to the underwriters. If the over allotment option is exercised, it is the company’s current intention that one half of the shares covered by the option will be sold by PaySys and one half by Intelligent Systems Corporation, a selling shareholder. The price range of the offering is estimated in the registration statement at $11 to $13 per share.

NationsBanc Montgomery Securities, Inc., and Raymond James & Associates, Inc., will be the managing underwriters.

PaySys is a provider of software for processing credit card transactions. Its current product, VisionPLUS, is a customizable software system consisting of a range of integrated application modules for processing both bank and retail credit card transactions. PaySys licenses its software to banks, finance companies, and retailers that process their own credit card transactions as well as to third-party processors that process such transactions for others.

A registration statement relating to the PaySys common stock has been filed with the Securities and Exchange Commission but has not yet become effective. Such securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This release shall not constitute an offer to sell nor the solicitation of an offer to buy nor shall there be any sale of such securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

A preliminary prospectus relating to the offering may be obtained from NationsBanc Montgomery Securities, Inc., 600 Montgomery Street, San Francisco, Calif. 94111, Attention: Matt Quinlan, or Raymond James & Associates, Inc., 880 Carillon Parkway, St. Petersburg, Fla. 33716.

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NFCC Holiday Tips Part 2

Gift giving and entertaining can blow a budget to pieces. “You want each present you give to be the best and each party a huge success,” says Durant Abernethy, president of the National Foundation for Consumer Credit (NFCC). “But that doesn’t mean the gifts have to be expensive or the meals elaborate. Instead, by thinking creatively, you can have a great holiday without overspending.”

NFCC is offering a four-part series (Holiday Spending: A Plan for the Season) to help consumers avoid overspending this holiday season. Part one covered budgeting tips. This second installment covers inexpensive gift and entertaining ideas.

Part Two: Inexpensive Giving and Entertaining Gifts with a personal touch. Turn a favorite hobby or unique skill into a treasured gift by making things such as vests, appliqued tote bags and cutting boards. Or make scented candles, customize holiday decorations or hand paint sweat shirts. Gardeners can share plants decorated with holiday trimmings, a wreath from vines or shelled home-grown pecans. Or surprise your parents with a photo of all of the children together. Gifts from the kitchen. Home baked goods are perennially popular. Buy supplies in bulk to save money, triple recipes and make fudge or cookies to share. Also consider making breads, jams, tamales or flavored vinegars. Prepare casseroles for those who will be entertaining family over the holidays. Have fun. Visit garage sales, resale shops and flea markets for unique gifts that don’t cost a lot of money. Finds may include kitchen accessories, a tricycle or bicycle or yard decorations. Give of your time. Give an elderly grandmother tickets to a movie or play in the company of her grandchildren. Other possible gifts include an afternoon of minor home repairs, baby-sitting, car-washing, meal preparation or errand running.

NFCC offers inexpensive gift ideas add one

In addition to gift giving, the holidays bring out a festive mood in us and we want to entertain. NFCC offers these hints for keeping costs down while still enjoying the season. Caroling party. Sing in your neighborhood, at a local nursing home or hospital. Afterwards have everyone meet at your home for cider, hot chocolate and desserts. Cookie swap. Host a cookie-swap. Each guest bakes about three dozen of his or her favorite holiday cookie recipe to share at the party. When they return home, your guests will have sampled a variety of cookies and leave with different cookies for gift giving or entertaining. Open house/Pot luck supper. Host a pot luck supper or informal open house instead of an expensive sit-down dinner. Center the evening around a tree trimming or other theme or invite musically gifted friends to lead a sing-along.

Finally, if you find yourself getting carried away by holiday spending, remember the spirit of the season. “Take a minute to remember your favorite holidays,” says Abernethy. “For most of us, they center on the friends and family who were there and traditions we shared. The presents we received are less important than the people.”

To learn more about budgeting and using credit or to receive confidential money management counseling, contact a local NFCC member agency. The National Foundation for Consumer Credit is the nation’s oldest and largest non-profit organization providing education and counseling services on budgeting and credit. NFCC members, located in 1,300 offices across the United States, Puerto Rico, and Canada can be identified by the NFCC member seal. This seal signifies standards that include agency accreditation, counselor certification, and polices that ensure confidential services that are free or low-cost. Many members operate under the name Consumer Credit Counseling Services. To locate the closest NFCC member office, call toll-free, 24 hours a day 1-800-388-2227 or visit the NFCC Home Page at http://www.nfcc.org>. Spanish speaking consumers can call 1-800-682-9832.

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Sears Ratings Not Affected

Duff & Phelps Credit Rating Co. (DCR) does not expect there to be any negative rating implications for Sears Roebuck and Co. as a result of Sears recent earnings announcement, which disclosed adverse trends in its credit card business.

Of concern is that the company is continuing to record significant increases in delinquency and charge-off rates, contrary to industry experience. While the adverse credit trends will likely affect fourth quarter 1997 results, the negative impact should be mitigated by the recent implementation of more proactive risk management practices. Positively, Sears` retail businesses remain fundamentally strong and well positioned. DCR rates the senior debt of Sears, Roebuck and Co. and its financing subsidiary, Sears Roebuck Acceptance Corp. (SRAC) `A` (Single-A). SRAC`s commercial paper is rated `D-1` (D-One).

Adjusting for FAS 125, Sears recorded an 85 percent or $231 million increase in the provision for uncollectibles during third quarter 1997. While there has been a flattening of personal bankruptcy filings, delinquencies and losses continue to rise. At the end of third quarter 1997, 60-day-plus delinquencies comprised 6.9 percent of the portfolio versus 5.3 percent a year ago and 5.9 percent at the end of second quarter 1997. The higher delinquencies and losses are largely associated with Sears aggressive investment in new account growth of recent years. Sears has responded by slowing new account origination activity, bolstering its collections operation and reducing credit lines to customers who are showing negative trends in behavioral patterns and creditworthiness. Positively, higher pricing initiated earlier this year allowed the net interest margin to expand by $259 million or 288 basis points, which mitigated the effects of rising losses. Sears` asset quality trends are contrary to industry performance and are deviating from the company`s own historical experience. Consequently, management is not comfortable in forecasting near-term financial performance in its credit card operations or on a consolidated basis, but DCR does not believe the current difficulties will warrant any rating action.

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Rapidly Expanding

Banc One’s ‘Rapid Cash’ ATM program signed up the Rite Aid Corporation yesterday. Under terms of Monday’s agreement, Banc One will install up to 2,000 ‘Rapid Cash’ machines in Rite Aid drugstores by April of next year. Rite Aid has a total of 3,963 stores in 31 states. Yesterday’s deal will bring the total number of Banc One ‘Rapid Cash’ ATMs, installed or under contract, to well over 8,000. Among previous deals, Banc One announced in mid-July it will install more than 800 ATMs among all Sears’ full-line stores in the U.S.

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Kmart Card Sweepstakes

Kmart kicked off its ‘Reward Yourself’ sweepstakes this week offering top prizes of a 1998 Jeep Grand Cherokee and a 7-day cruise to more than one million Kmart credit cardholders. Cardholders are automatically entered each time they make a purchase through Dec 31 and consumers applying for the private label card are also entered. Kmart and Beneficial National Bank launched the card during August 1996.

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No-Fee AmEx Transaction Processing

Paymentech and American Express are targeting restauranteurs with ‘Network PIP’ and ‘SE Workstation’ this week. Paymentech is the first third-party payment processor to offer the AmEx network plural interface processing service which transmits American Express card transactions directly to AmEx and eliminates transaction processing fees. The ‘Network PIP’ service is available exclusively through NXT Corporation. The ‘SE Workstation’ product enables merchants to receive and respond online to cardholder inquiries for both AmEx and other bankcard transactions. Paymentech and AmEx say merchants can reduce chargebacks by enabling merchants to respond to a greater percentage of disputes.

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Apron Size Terminal

Hypercom introduced a new wireless, portable POS terminal for restaurant waiters Monday at the International Foodservice Technology Exposition, underway in Philadelphia. The new terminal dubbed ‘ICE Portable’ (ICE for Interactive Customer Equipment) is about the size of a portable CD player and incorporates touch screen, electronic signature capture and wireless technologies. The terminal can handle all credit/debit payments and includes a captive card reader for smart cards that prevents the card from being inadvertently removed during the transaction, thereby avoiding data corruption. The new terminal integrates easily with Hypercom’s ‘T’ series terminals, with up to 16 portable devices operated by a single controller terminal. ‘ICE Portable’ can transmit up to 75 feet and holds a two hour battery charge.

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Industry Behind on YR2000 Issue

American Management Systems (AMS), a leading business and information technology consulting firm, announced today the formation of a new practice to help financial institutions prepare for the Year 2000. “Financial institutions face disrupted cash flows, customer defections, and increasing regulatory and competitive pressure unless they move faster to address Year 2000 issues,” said Ray Strecker, vice president and leader of AMS’s Year 2000 finance industry practice. Credit card authorizations, interest calculations, electronic payments, securities settlements and many other transactions will be affected because most computers store the year as two digits instead of four and cannot distinguish the year 2000 from the year 1900.

Building on its significant consulting engagement with Chase Manhattan Bank, AMS’s group will help major institutions accelerate their Year 2000 programs. “Time is running out,” said Strecker. “AMS’s Year 2000 practice was formed to help financial institutions move into high gear using best practices from Chase and other leaders. Banks and brokerage houses that get this right will have a tremendous strategic advantage, the freedom to bring new and innovative services to the market while competitors are still bogged down with the Year 2000. Firms that fall too far behind will be worrying about survival.”

A Comprehensive, Program Management Approach

Chase’s Brian Robbins, senior vice president and manager of the Chase2000 Enterprise Program Office, said, “While much of the work for Year 2000 is technical, the impact to the organization is huge and necessitates the active involvement and direction of senior management. Activities must be coordinated across the organization. AMS is a key partner in helping us run our program office.”

Strecker, who has more than twenty years of financial industry experience, said, “The Year 2000 problem is the toughest management challenge most CIO’s have ever faced, and the deadline is completely inflexible. AMS helps clients assess, upgrade and test all applications, hardware, system software, desktops, and physical equipment that contains embedded microchips.

“Financial institutions face special challenges. They must preserve customers’ and regulators’ confidence, and be alert to the credit and market risks that can arise if their customers do not become compliant. AMS’s experience in large scale program planning and management can help mobilize the entire organization to deal with the whole problem set.”

AMS uses a program management approach supplemented by a Year 2000 methodology and tool kit, including:

* Year 2000 problem assessment, remediation and testing for applications, data centers, desktops and facilities

* Continuous monitoring and sharing of evolving Year 2000 best practices

* Comprehensive project estimating tools

* External vendor and industry interface management

* Customer and corporate stakeholder communication

* Program and project status reporting and risk management

* Credit and market risk identification, assessment, monitoring and control

AMS’s finance industry clients include all of the top 10 U.S. banks, several major Canadian banks, a number of leading brokerage and securities firms and over 150 major institutions around the world. Within the banking and finance industry, AMS offers specialized capabilities in consumer credit services, customer value management, trade services, corporate connectivity, securities processing, and global risk management.

AMS’s business is to partner with clients to achieve breakthrough performance through the intelligent use of information technology. AMS is an international business and information technology consulting firm that provides a full range of services: business re-engineering, change management, systems integration, and systems development and implementation. AMS, which completed its 27th consecutive year of growth, is headquartered in Fairfax, Virginia, with offices in 53 cities worldwide. AMS’s revenues for 1996 were $812 million.

AMS’s site on the World Wide Web is:

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Lucky Strike Phone Card Dispensers

Bingo & Gaming International, Inc. (OTC Bulletin Board: BING), announced today that it has signed an agreement with Prestige Distributing, Inc. of Guthrie, Oklahoma to distribute its Lucky Strike Pre-Paid Phone Card Dispenser. The agreement gives Prestige Distributing, Inc. the exclusive distribution rights for the state of Oklahoma for this cartridge based, video enhanced phone card dispenser.

The Lucky Strike Pre-Paid Phone Card Dispenser vends a two-minute phone card with a promotional sweepstakes game piece attached. Cash prizes up to $1000 are paid at the retail location.

“The Lucky Strike Prepaid Phone Card Dispenser will do as well in Oklahoma, as it has done in Texas. We feel fortunate to have an aggressive distributor in Oklahoma who has experience and contacts in both charitable and Indian Bingo operations. Barry Cogburn understands the market, has a vision of the potential of the Lucky Strike Prepaid Phone Card Dispenser, and will work diligently to secure locations for the dispensers. His first installation has already exceeded our goal of $250 per day per unit, and this was achieved on their first day in service,” stated Bingo & Gaming International’s CEO Reid Funderburk.

“A HOME RUN!!!!” … that’s how Barry Cogburn, President of Prestige Distributing described his first night of operating the Lucky Strike Phone Card Dispensers. “Lines of anxious customers were waiting for Lucky Strike Phone Card Dispensers to become available at our first bingo hall installation here in Guthrie on November 1st. We have other locations lined up and anticipate placing hundreds of phone card dispensers throughout the state of Oklahoma. These machines, combining the sale of a popular prepaid phone card with a McDonald’s type promotional sweepstakes game, will be a hit throughout the state,” concluded Cogburn.

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First Holiday Projections

[Click Here For 1997 Holiday Spending Trend][1]

American Express projects holiday spending for this year will be up 6%, from an average of $1,160 per shopper last year to $1,233 for the 97 Xmas shopping season. The ‘1997 American Express Retail Index’ shows about $879 of total holiday spending this year will be spent on gifts with the balance going to travel, decorations and entertainment. The annual survey of 800 consumers also shows spending by men is up sharply this year and that Southerners plan to spend the most on gifts. AmEx also found that approx. 20% of households with annual incomes over $100,000 will redeem credit card reward points to obtain items they will give as gifts.

[1]: /graphic/americanexpress/97holidaytrends.html

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