Florence Olsen reports in FCW.com about e-signature usage by governmental agencies -- and some new approaches they're taking.   » Continue Reading

Barnaby Feder reports in the New York Times on facial recognition technology.

Despite growing acceptance, there is still a huge gap between the hype about the promise of face recognition technology and the results when it is put to the test.

Larry Dignan reports in Baseline on the Corporate Information Security Accountability Act of 2003, legislation introduced last fall by Rep. Adam Putnam (R-Fla.).

In the name of protecting national infrastructure, you may be asked to conduct annual security audits, produce an inventory of key assets and their vulnerabilities, carry cybersecurity insurance and even have your security measures verified by independent third parties, if the core features of the proposed legislation make it to the floor of the House.

The GAO has issued a report (PDF) that is critical of security at the Federal Deposit Insurance Corporation (FDIC).

Jeremy Wagstaff blogs some advice for banks in dealing with phishing attacks.

A brief article in CSO Magazine reports on the shift in how courts are viewing liability with respect to certain "foreseeable events".

Security breaches have never been more highly scrutinized by the courts and regulators, and they are redefining what companies should have seen coming—be it a stolen aircraft or a computer virus. Implementing the right policies, procedures and technology now can limit your company's liability in the future.

Anyone involved in protecting personal financial information of any kind should tune into what's happening with respect to higher standards being required to avoid potential downstream liability.

The Federal Trade Commission has filed suit in federal court to halt an effort that drained millions of dollars out of thousands of consumers’ checking accounts for “discount pharmacy cards” the consumers didn’t know about, didn’t order, and didn’t get. The Washington Post reports on this story in Friday's edition.

Merchant acquirer National Processing has announced it is reviewing strategic alternatives for the company, perhaps including the sale of the company. National Processing is 83 percent owned by National City Corp.

Jeremy Wagstaff reports in today's Wall St. Journal on the evolution in sophistication of phishing attacks (subscription reqd.) -- and the people that develop them.

By the way, Jeremy is also a very prolific weblogger. Check out his "Loose wire" blog.

Experian-Scorex and TSYS have announced an expanded partnership with the implementation of a new transaction fraud scoring model which is now embedded in the TSYS CardGuard fraud detection system.

Experian-Scorex designed the transaction fraud model using existing CardGuard members. The design process included the study of over 2000 attributes and extensive segmentation analysis. The score uses a combination of up-to-date historical information and a long-term profile of each customer to ensure accuracy and reliability.

We're proud to announce that Bryan Derman is the newest Glenbrook partner.   » Continue Reading

Glenbrook Partners' Russ Jones has published an opinion piece titled "Rethinking Online Marketing - The Impact of Phishing and Spam on Marketers".

Marketers have spent much of the last decade shifting the focus of their marketing campaigns from traditional channels to the Internet. While results were initially rewarding, with each passing month this new channel becomes noisier, more crowded, harder to manage, and substantially less effective. A new form of online fraud (phishing) and a HUGE surge in unsolicited email (spam) have combined to create the perfect storm for online marketers.

MasterCard Advisors has announced it is acquiring Watch Hill Partners.   » Continue Reading

Stanford Law School Professor Lawrence Lessig shares his frustration with how Chase handled his credit card account. Readers also add their comments on his experience.

The Stanford University Law School is hosting a conference on June 25 titled "How to Deal with the Uncertainties of Online Business". Speakers include executives from Visa International, Google, Yahoo!, Apple, Microsoft and partners from a number of law firms.

The FDIC has published a report by Prof. Neil Murphy that examines the impact of payment system changes underway on the US banking system (PDF).   » Continue Reading

The Technology Report in this morning's Wall St. Journal (subscription reqd) includes "A Dollar Here, A Dollar There...", a report on micropayments.

Wells Fargo has announced that it handled $3.8 billion in Internet payment volume for over 61,000 online merchants in the first quarter, up 50 percent over the same quarter last year. Wells Fargo is also PayPal's payment processor.

"According to figures published by the U.S. Department of Commerce, Wells Fargo's e-commerce processing accounts for 15 percent of the nation's total online shopping volume."

Hiawatha Bray comments in today's Boston Globe on how the surge in phishing attacks is the best news yet in the war against spam.

But how is this good news in the fight against spam? It's obvious, really. The old-style spammers only made life difficult for Internet users and service providers. The phishermen are messing with the real big boys -- the nation's banks and credit card companies. Phishing could cost them billions, and scare consumers away from Internet commerce altogether. ''The banks and the big e-commerce companies are desperate for a solution," said Dave Jevans, chairman of APWG. And desperation backed by money is a powerful thing.

Meanwhile, Tumbleweed and the Anti-Phishing Working Group this morning announced a new "Phishing Attack Trends Report" for April 2004 reporting that email fraud and attacks grew by 180% during April, averaging 38 new attacks each day.

MasterCard and Oracle have announced a partnership that will allow MasterCard's enhanced transaction data to be integrated into selected applications within Oracle's E-Business Suite.

AP writer Brian Bergstein asks whether the identity theft protection services now available are the best approach to dealing with the problem.   » Continue Reading

Amey Stone reports in Business Week on how consumers can avoid becoming victims of phishing attacks.

The Register updates progress on the chip and PIN rollout underway in the UK.

Anne Eisenberg reports in the New York Times on Beepcard, a credit card with an unusual security feature: it works only when it recognizes the voice of its rightful owner.

Gerry Gilmour reports from Fargo, North Dakota on the shift from paper to plastic card payments.

McConn breaks down Alerus customers into three general demographic groups: the younger generation, which has fully embraced debit cards as a way of life; those in their 30s to 50s, who like their credit cards but are adjusting from checks to bank debit cards at the checkout; and older folks, who still prefer checks – and sometimes balance their checkbook in the checkout line.

Edgar, Dunn takes a look at the organizational silos in financial institutions and how some saavy bankers are pursuing enterprise-wide payments strategies that break those silos down.

Amanda Kooser reports in Entrepreneur on the uptick in Silicon Valley and, in particular, on BitPass as an example.

MasterCard VP Murdo Munro writes about mobile prepaid services and MasterCard's rePower payment solution.

The Economist says PayPal is turning into a huge online-payments business.   » Continue Reading

The PORTIA Project (Privacy, Obligations and Rights in Technologies of Information Assessment - funded by the National Science Foundation) is sponsoring a workshop on sensitive data in medical, financial and content-distribution systems at Stanford on July 8-9, 2004.

Sprint has introduced Mobile Loan Officer, a service that will allow bank employees to process loans, establish accounts, transfer funds and complete other financial transactions using wireless handheld devices certified to operate on the enhanced Sprint Nationwide PCS Network.   » Continue Reading

The Reserve Bank of Australia has published its latest statistics on bank fees in Australia (PDF). Bank fees associated with credit cards were up 38% in 2003 to a total of A$604 million on total credit card purchase volume of A$108 billion (up 12%).

The continued rapid growth in credit card spending, together with increases in annual membership fees and higher charges for overdrawn accounts, late payments and cash advances, contributed to banks' fee income from credit cards.

Interestingly, Australia is a market where the financial regulators have been very aggressive with respect to credit card interchange fees. In spite of those efforts, the Australian banks have figured out new ways to drive credit card-related fee income.

MasterCard has released a new Procurement Opportunities Guide that provides small businesses in the United States with detailed information that assists them in marketing products and services to large corporations and state, federal and foreign governments.

The US Department of Justice reports that Zachary Keith Hill of Houston, Texas has been sentenced to 46 months in prison for orchestrating a scheme to defraud consumers of personal financial information via phishing emails.   » Continue Reading

The Office of the Comptroller of the Currency has issued a letter to banks regarding payroll card products.

A national bank should fully consider and appropriately address several important issues before offering payroll card products. These include compliance issues and any role of nonbank third parties. Failure to properly address these issues can expose the bank and its customers to significant risks.

The CO-OP Network has made available a recent study titled "Navigating the Payments Landscape" (PDF).

Jack Milligan writes in the latest issue of Banking Strategies about the threats to bank dominance in payments that online competitors could represent.

AT&T has announced that it has been selected by SVPco to provide a networking solution that enables the reliable and secure exchange of digital check images among financial institutions of all sizes across the United States.

Importantly, the announcement also indicated that AT&T's network service will serve as an industry utility to carry other types of payments and payment information, such as real-time retrieval of demand deposit account information and other data-sharing as needed between business partners.

Celent has published a new report on IT Spending in Non-Card Payments at US Banks.

The report reveals that U.S. bank internal IT spending on non-card payment systems will grow 37% between 2004 and 2003 compared with 24% between 2003 and 2002 and 14% between 2002 and 2001. Massive investment in check processing will drive this short-term spike.

Bank internal IT spending on non-card payments will reach $1.0 billion in 2004, up from US$0.7 billion in 2003 and US$0.6 billion in 2002. This spending will account for 2.7% of the total IT budget of U.S. banks in 2004, up from 2.1% in 2003 and 1.7% in 2002.

Ted Griffith reports in Delaware Online about expectations for a rise in interest rates and the potential affects on major card issuers.

Gary Leff shares his recommendations on the best mileage earning credit cards. His favorites are the Starwood American Express card and Diners Club.

Silicon.com reporter Sylvia Carr writes on a recent survey conducted among UK retailers which indicates 26 percent of them are unconvinced of the benefits of chip cards.

Newsweek's Jennifer Barrett reports on recent phishing attacks.

Rafe Needleman writes in AlwaysOn about Netpace's SMS-based commerce service.

What really speaks to me about this idea, though, is that Netpace and its competitors are hastening the expansion of the mobile phone carriers' business models. The idea that your mobile phone becomes not just an identifying key for commerce (like a signature), but also a kind of wallet (like a credit card) is powerful and transformative for the communications business—even more so than the 900-number concept, which has generally been used only to bill voice-based services delivered over the phone itself.

Visa USA has announced the Commercial Consumption Expenditure (CCE) index, a financial metric to standardize how business and government spending is tracked within the United States. According to Visa, the new index will enable the payment industry, including Visa and its Member financial institutions, to measure and forecast the actual and future penetration of commercial payments products in meeting the market's needs.   » Continue Reading

Metavante has made available online a presentation on its recent acquisitions including today's announcement re: NYCE.   » Continue Reading

Metavante announced this morning that, subject to regulatory approvals, it will be acquiring all of the stock in NYCE for approximately $610 million in cash. FDC, the largest NYCE shareholder, will receive $389 million in proceeds.

NYCE had 2003 revenue of approximately $143 million and net income of approximately $30.7 million. According to the announcement, the transaction is expected to be approximately neutral to M&I's earnings per share in 2004 and accretive in 2005.   » Continue Reading

Bank of America this morning announced that it will "enhance its environmental programs with climate change and forest policies that take significant new steps in the reduction of greenhouse gas emissions, protection of intact forest ecosystems and transparent public reporting to all stakeholders."

The Cherry Hill (NJ) Courier Post reports on plans by the governor of the state of New Jersey to have legislation adopted that would allow the state to benefit by taking any funds in gift card accounts after a three year period of inactivity.

New Jersey is one of 10 states that doesn't now count gift cards and gift certificates as unclaimed property, though another nine states shield only some types of the gifts, based on the kind of issuer or the value of the gift.

Gemplus has announced that it has begun delivering a new generation of MasterCard payment smart cards.

Bob Tedeschi reports in this morning's New York Times on how some people fall for work-at-home job postings on online job sites that unwittingly put them into the wrong business.

The Korea Times reports on the surge in mobile banking usage in Korea.

"Emulating the enormous success of similar services on the Web, mobile banking is proving to be a home run this year with full-fledged implementation,'' Tongyang Investment Bank analyst Lee Tae-jin said. ``The service will gain further momentum in the future.''

Jennifer Bayot writes in the New York Times about single use credit card numbers.

The companies have tried to make the numbers easier to use. A cardholder can now charge monthly phone bills and other recurring payments to the same disposable number, rather than entering a new one each time. Similarly, a cardholder can register a number with a favorite merchant for continued use only with that merchant.

"You'll never need to reveal your actual credit card number again," said Amy Radin, executive vice president for the e-business unit of Citi Cards, a division of Citigroup.

Albert Crenshaw writes in this morning's Washington Post about the lobbying campaign "Enough is Enough" that bankers have launched to attempt to prevent credit unions from benefiting from pending legislation that would expand their business opportunities.

SurfControl reported yesterday that the number of "brand spoof" attacks have increased nearly 500 percent since January and by 51 times since May 2003.

In the latest scam addressed to US Bank customers, the scam asks e-mail recipients to verify and update their “Internet Banking Accounts,” by clicking on a link within the e-mail. E-mail recipients who click the link in the scam e-mail are taken to a page that displays a fake address bar containing the real US Bank Web site address. This address bar has been constructed to overlay an e-mail user’s existing address bar, which normally identifies the address of the scammer’s server. Larson said the spammers use Javascript code to calculate where the address bar is located on the e-mail user’s Web browser, so it can be covered with the alleged “legitimate” address details.

Mary Kirwan reports in Canada's Globe and Mail on phishing.

Why bother? Brand value is an extremely important business asset. Do you really want to sit back and watch it dissipate?

The Cincinnati Business Journal reports on Fifth Third's selection to handle credit card acquiring for Wendy's.

WJLA in Washington, DC reports on a new combination MasterCard and SmarTrip fare card for the Washington area Metro transit system to be issued by Citibank.

The New York Times has an editorial this morning titled Dollars Without Borders addressing the need for lower cost money transfer and remittance services.

The total amount of money flowing from developed nations to developing nations through remittances has nearly quadrupled in the last seven years. But the systems by which emigrants send the money home have not kept pace. Too many people still rely on transfer agencies like Western Union. These agencies have become cheaper and safer, but much more can be done to foster the development of poor nations' financial systems, which still serve only one in 20 households that get remittance money.

Visa EU has updated it web site to include details of Visa's interchange rates as they apply to intra-regional transactions.

Jay Layman reports on NewsForge on PayPal's recently announced application program interfaces (API's).

Consult Hyperion, a UK-based consultancy, discusses how banks may be able to take advantage of their current roll-out of chip and PIN capability to fight phishing attacks.

Carol Coye Benson of Glenbrook Partners has just posted a pretty provocative opinion piece on the subject of preventing identity theft over on the Glenbrook web site.   » Continue Reading

News 11 in Atlanta is reporting on how the US Secret Service is going after waiters who skim credit and debit cards when diners pay for their meals.

Gareth Mackie reports in The Scotsman on the chip and PIN rollout in the UK.

By the end of this year, the majority of credit and debit cards in the UK will contain a small computer chip that will store data to identify the cardholder, and by 2005 most users will enter a four-digit personal identification number (pin) rather than signing a receipt.

The Pennsylvania Office of Consumer Advocate is alerting consumers that may have paid utility bills using CashPoint Network Services to carefully check their next statement to ensure proper credit was given. CashPoint recently filed for bankruptcy protection.

Dave Webb reports in IT Business Canada the results of a consumer discussion on wireless held recently.

To the surprise of other participants, every consumer panelist had a gas station micropayment card, either an Esso Speedpass or a Shell EasyPay tag. And in terms of customer behaviour, it's probably the application that has the most influence, especially when it's 30 below outside. Panelists agreed they go out of their way for a Shell or Esso station, just for the convenience factor. One seemed to yearn for a world in which it was the only way to pay: "If everyone used it," he said, "life would be much simpler." At the same time, nobody looked forward to the idea of a dozen micropayment tags dangling from their key rings. Aggregation of micropayment services was high on the wish list.

The US Office of the Comptroller of the Currency has issued a letter to banks regarding risk management new, modified, or expanded bank products and services.

During periods of reduced net interest margins, stagnant growth in traditional business lines, and increased competition, bank managementrs and directors face many challenges in seeking to improve the bank's financial performance. Engaging in new, expanded, or modified bank products or services is often considered a solution. However, if management and the board are overly focused on expected returns, do not have a good understanding of the inherent risks, or have poor governance practices, the bank's ability to effectively measure, monitor, and control the risks inherent in such products or services may be compromised.

The European Union has announced that it is soliciting comments from industry regarding its current E-Money directive.

Steve Bills reports in the American Banker on PayPal's efforts to sign mass merchants including its recently introduced application programming interfaces.

Sam Varghese reports in The Age from Australia on new phishing attacks in Europe not using the English language.

Meanwhile, the UK's icLiverpool reports on phishy emails.

A report from India's Financial Express on the launch of Cibil, Credit Information Bureau (India) Ltd., India's first credit bureau.

George Albert writes in India's Hindu Business Line about growth in dual use cards, particularly a focus for GE.

Kathy Chu of the AP reports on single use card numbers.   » Continue Reading

A discussion about MasterCard's PayPass product is taking place on Slashdot.

Dexit, a Toronto-based firm, is pursuing the market for low value electronic payments using RFID technology at physical point of sale locations.

Is there a reliable payment system for virtual goods? Robert Cringely claims it's not PayPal.

PayPal is not built to reliably support a peer-to-peer economy.

PayPal has posted in their Security Center a new Ecommerce Safety Guide (pdf).

Ellen Kelleher reports in the Financial Times about Discover's prospects.

MasterCard has published information about the growth in debit card usage in the US market.   » Continue Reading

Discover CEO David Nelms has announced that Discover is actively seeking partnerships with US financial institutions and merchants.   » Continue Reading

Gartner has announced results of a study on phishing that concludes that direct losses from identity theft fraud perpetrated against phishing attack victims cost U.S. banks and credit card issuers about $1.2 billion last year.

Mark Fernandes reports on phishing in the Prague Post.

Experts say the threat from phishing could potentially have a devastating impact on consumer trust in e-commerce and e-banking despite attempts by government and law-enforcement officials to crack down on fraudulent Web sites. The open nature of the Internet makes it easy for criminals to hide, say police and consumer advocates.

Separately, David Ticoll reports in Canada's Globe and Mail on how to avoid being the victim of a phishing attack.

Carolyn Said reports in this morning's San Francisco Chronicle on the growth in card payments and some other comments based upon an interview with Visa USA CEO Carl Pascarella..

Lavonne Kuykendall reports in today's American Banker on Citibank's new signature-free account opening process for new checking accounts via its web site.   » Continue Reading

Glyn Moody reports on Netcraft about the parallels between spam and phishing.

NACHA reported today that more than 60 percent of consumers are enrolled in Direct Deposit, up over 4 percent from 2003. Direct Payment (a pre-authorized debit that uses the Automated Clearing House network for recurring consumer bills such as mortgages, loans, and utilities) is being used by more than 50 percent of Americans. NACHA estimates that by using Direct Deposit and Direct Payment the average consumer can save more than $400 a year.

MasterCard has announced growth in purchase activity on MasterCard-branded cards of 13.6 percent for the first quarter 2004 as compared to the prior year.

PayPal has announced PayPal Web Services, a suite of new web services API's.

PayPal Web Services enables more streamlined and automated access to the PayPal platform, and broadens the audience for PayPal's ecommerce tools to include advanced technical developers and enterprise customers. PayPal Web Services are based on open standards, supporting Simple Object Access Protocol (SOAP) and Web Services Description Language (WSDL).

"Through PayPal Web Services, we are able expand the availability of advanced online payment capabilities to a new class of developers, third-party tool vendors and merchants," said Dave McClure, Director of PayPal's Developer Network. "These new standards-based APIs will allow almost anyone to create innovative applications and services incorporating PayPal."

AP Technology Writer Brian Bergstein has interviewed Choicepoint chairman Dennis Smith regarding his views on identity vs. security.

Dennis Fisher reports in eWeek on the increasing sophistication of phishers. Meanwhile, the IRS has warned email users to be on the lookout for emails attempting to solicit personal information by spooking the consumer into thinking they're under investigation.