Friday, December 11, 2009 Pits Verifone vs. Square

iPhone Payments Smackdown: Square vs. Verifone

The mobile payment wars are on. Recently, Twitter co-founder Jack Dorsey announced his new venture, Square, a device that allows a physical credit card payments to be swiped via their mobile phone. Soon after Verifone annouced a similar solution, PAYware Mobile. While PAYware Mobile attaches to an iPhone, Square aims to work with any mobile device provided it has a headphone jack. Since iPhone Apps took off, there have been many payment apps and there have many payment solutions/add-ons for mobile devices.

So what's all the fuss? Is the Square a game-changer and is it secure? Is Verifone's PAYware Mobile a "Square-killer"? has been following Square and it appears they have been following us too, or at least as seen in a recently posted Tech Crunch video.

Tech Crunch's Michael Arrington has been cozy with Mr. Dorsey and helping him spread the word about Square. In a recent blog post, Arrington, kindly using, showed Mr. Dorsey the Verifone announcement and took a swipe at Verfione for using a Photoshopped image of the PAYware Mobile product. Arrington claims that due to Square's great press that other payment providers, like Verifone, were rushing to put their product on the market. Arrington and Dorsey discuss how Square is different than Verifone's offering and how secure Square will be.  (see the video at the bottom of this post)

While it may be true that Verifone rushed to market, it is also true that there have been many other applications to hit the market (see the CC Terminal App for the iPhone) and hardware in the market.

In reaction to our Square announcement, John Frank (VP Sales & Marketing, HomeATM ePayment Solutions), noted his company had a similar product prior to Square and PAYware Mobile:

"The hype over this is amazing considering that HomeATM ePayment Solutions came up with a better product (PCI 2.x PED Certified) more than a year ago (which also plugs into an earphone jack of any phone). Especially considering that our device not only accepts Credit and Debit but PIN based Debit and Prepaid cards and allows for real-time money transfer. There's absolutely no question that if Mr. Dorsey was not the Silicon Valley Rock Star he is, based on the fact that he's the founder of Twitter, the buzz around the product would be closer to the buzz we've gotten over the last 12 months. I have yet to see anything written regarding the security of the device (i.e. HomeATM utilizes 3DES DUKPT encryption and encrypts the Track 2 data) but nonetheless, it is refreshing to see to see interest in the device as I am of the position that in an 'Apple to Apple' comparison, the HomeATM device (with all due respect) is far superior in most every way. That said, it might make for an interesting story if PYMNTS was the one to conduct that comparison and publish the results. We would certainly be willing to go head to head with the device in a product comparison."

( would love to host a head-to-head as well, and has requests out to Square and Verifone)

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Obviously deemed it unfair to compare our device to the Square because the Square cannot conduct PIN based transactions nor is it PCI 2.x PED Certified.  The outcome would be too predictable.   So I left a comment as to that effect:

Jonathon...Glad you liked the idea of the "Apple to Apple" comparison. I agree with your obvious conclusion that It wouldn't be fair to include HomeATM's device when doing a comparison. That would be more like an "Apples to Oranges" comparison as:

A: We have an integrated PIN Pad

B: Our PIN Entry Device has been PCI 2.x PED Certified.

C: We 3DESD/DUKPT encrypt the PIN and the Track 2 Data at the maghead.

That said, It will be interesting to see how the Ver-iPhone stacks up against the Square. It's also good to see the industry ask important security based questions.

When the Square and Verifone unit are capable of doing PIN Based Transactions, (and are PCI 2.x PIN Entry Device Certified) we would welcome a head to head match-up. Until then, the outcome of which device is superior is too predictable.

Oh, one more thing. If and when the Square gets PCI 2.x certified and has a PIN Pad, we'll not only be happy to participate in a magnetic head to head/encryption comparison, but we can also compare patent applications filed on hooking up a mobile device via an earjack.

John B. Frank

VP Sales & Marketing

HomeATM ePayment Solutions

Posted by John B. Frank, 11/12/2009 1:27pm (58 secs ago)

See the video here:

Phishing Costs Banks $9.40 per Year/per Customer!

About half of those online bankers who do visit fraudulent phishing sites pretending to be from their financial institution serve up their log-in credentials, according to Trusteer, an international anti-phishing specialist, costing banks MILLIONS.  In fact, phishing costs banks up to $9.4 million a year per one million online banking clients, Trusteer said.  That equivocates to $9.40 for EVERY online banking customer per year. 

If banks provided HomeATM's PCI 2.x Certified PIN Entry Device to their online banking customers for "secure two-factor" authentication, those customers could access the online banking session the same way they access cash at an ATM.  Swipe Card, Enter PIN (yes...using existing cards,  existing PINs and existing bank rails)  PLUS they could enable their online banking customers to conduct real-time P2P money transfers from any bankcard to any bankcard.  
All while completely eliminating the threats posed by phishing.  By eliminating the process of typing, we eliminate the "phish."  Based on the fact that we instantaneously encrypt the card holder data means there is NOTHING to phish phor.  Not a pretty picture to those who make their living phishing,  is it?   
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Fed’s Rich Oliver, NACHA’s Jan Estep to Headline EastPay Conference
RICHMOND, Va.--(BUSINESS WIRE)--With a focus on electronic payments, EastPay’s Information Interchange 2010 is a conference designed to provide attendees with the strategies to maximize business efficiencies, improve payment processes, reduce risk, and increase client satisfaction. To be held February 7 - 9 at the Rosen Centre Hotel in Orlando, this long-standing payments industry conference targets payments professionals from financial institutions as well as corporations and government entities. In keeping with the current economic environment, the theme of the 2010 conference is “Electronic Payments: Challenge, Risk, and Reward.”

Long regarded as an excellent value for professional continuing education credits, this year’s conference has been approved by NACHA for up to 13.2 continuing education credits for the AAP certification (including optional Sunday workshops). Areas of focus for the conference are reflected in the session tracks: Operations and Technology, Risk and Compliance, and Treasury Management. Attendees will increase their critical understanding of electronic payment applications, their real-world use, the inherent risks, and the unique benefits. Informal networking opportunities with peers, industry expert speakers, and exhibiting solution providers enrich the educational experience.

The keynote speakers are Rich Oliver, EVP and Retail Product Manager, Federal Reserve Bank of Atlanta; and Jan Estep, President & CEO, NACHA. Other featured speakers include Michael Reagan, Managing Director, Global Payment Solutions, Fiserv; Gregory Miller, Chief Economist, SunTrust Bank; Gail Angel, Division President, Commercial Treasury Solutions, FIS; and Kenneth Richey, Director of Corporate Cash Management, Synovus Financial Corp.

Conference sponsors are Fiserv, The Clearing House, NACHA, Epson, EFC Systems, and Digital Transactions. Exhibiting companies are ACH Alert, Affirmative Technologies, ASV, ATTUS Technologies, ECCHO, EFC Systems, Federal Reserve Bank, and Gulf Management Systems.

The early registration price of $415 is available through December 31. The registration fee as of January 1 will be $465. An additional $50 discount is available to registrants that have attained the Accredited ACH Professional (AAP) certification. Multiple registrant discounts are available when more than one person from the same organization registers. Optional Sunday workshops are available for a separate registration fee of $55 each. To register, or for information on sponsorship and exhibit opportunities, go to The deadline for the group hotel rate at the Rosen Centre Hotel is January 17, 2010.

ABOUT EASTPAY: EastPay is a trade association providing over 800 financial institutions and businesses in the Southeast with payments education, regulatory compliance support, Payments Advisory Services, and Risk Management Services. As accredited experts on the operating rules of the Automated Clearing House (ACH) network, EastPay helps organizations take advantage of the opportunities and avoid the risk presented by the phenomenal growth of electronic payments. EastPay is a Regional Payments Association member of NACHA – The Electronic Payments Association.
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TJX Hacker to Plead Guilty to Heartland, Hannaford and 7-Eleven Breaches

Wired reported that Albert Gonzalez,  aka "Soup Nazi" has agreed to plea guilty to charges that he not only hacked TJX, but also was responsible for the Heartland Payment Systems Breach.  Apparently he was also behind the Hannaford and 7-Eleven breaches as well.  Wonder if he gets into the Guinness Book of World Records?  Brilliant!

Admitted TJX intruder Albert Gonzalez has entered into a plea agreement on charges that he hacked into Heartland Payment Systems, Hannaford Brothers, 7-Eleven and two other unnamed national retailers.

The revelation comes in a filing made by Gonzalez’s attorney in U.S. District Court in New Jersey, where the Heartland charges were filed in August.

A federal judge on Tuesday officially transferred the New Jersey case to Massachusetts, where Gonzalez is seeking to merge it with two other cases in which he’s already pleaded guilty.

Gonzalez, a former Secret Service informant known by the online nicks “segvec” and “Cumbajohnny,” was charged in New Jersey in August, along with two unnamed Russian hackers. They were accused of stealing more than 130 million debit and credit cards from card-processing company Heartland and the other target companies.

Gonzalez and 10 others were also charged in May 2008 in New York and in August 2008 in Massachusetts with network intrusions into TJX, OfficeMax, Dave & Busters restaurant chain and other companies. Gonzalez pleaded guilty to these charges in August and was scheduled to be sentenced in Massachusetts on Dec. 21 in both cases.

He was expected to get a sentence of between 15 and 25 years in prison. That sentencing is likely to be delayed now to allow time for the new guilty plea, and for the government, defense and U.S. probation office to recalibrate their sentencing positions to account for the New Jersey charges.

TJX Hacker to Plead Guilty to Heartland, Hannaford Brothers, 7-Eleven Breaches

NACS Online - ‎Gonzalez was charged in August, accused of stealing more than 130 million debit and credit cards from card-processor Heartland and other companies. ...

Reuters - The Star-Ledger -

Holiday Shoppers Plan to Spend Nearly 15% less This Year, according to Discover

CORRECTING and REPLACING Holiday Shoppers Plan to Spend Nearly 15% less This Year, according to Discover(R) Card Holiday Shopping Survey

Almost Two-Thirds Express Concern about Finances, But Nearly 80 Percent Say Spending Less Won’t Put a Damper on Their Holiday Spirit

CORRECTION…by Discover Financial Services

RIVERWOODS, Ill.--(BUSINESS WIRE)--Please replace the release with the following corrected version due to multiple revisions.

The corrected release reads:


Almost Two-Thirds Express Concern about Finances, But Nearly 80 Percent Say Spending Less Won’t Put a Damper on Their Holiday Spirit

Discover Financial Services (NYSE: DFS) today released its annual Holiday Shopping Survey, which assesses consumer spending trends and gift intentions for the 2009 holiday season. This year, shoppers plan to spend 13 percent less on holiday gifts compared to last year. Forty-eight percent of shoppers who plan to spend less said the economy was very influential on their decision to cut back on holiday spending this season. But of those spending less, nearly 80 percent say it will not put a damper on their holiday spirit.

Key survey findings include:

  • On average, shoppers plan to spend $723 on holiday gifts, compared to $831 in last year’s survey and $896 in the 2007 survey. Women plan to spend more than men – $742 versus $702, respectively.

  • Forty-seven percent of shoppers plan to spend between $100 and $500 this holiday season while a quarter (25 percent) anticipate spending anywhere from $500 to $1,000.

  • Forty-three percent of shoppers plan to spend less this holiday season. Of this group, 48 percent say that the economy was very influential in their decision to do so.

  • As the holidays approach, 63 percent of shoppers say they are very concerned, concerned or somewhat concerned about their finances. This is down from 74 percent who said the same last year.

  • Sixty-six percent say they plan to stay within their holiday shopping budget. This is down slightly from the 73 percent who said they would do so last year.

Holiday Shoppers Seek Deep Sales, Incentives and Less Expensive Brands; Credit Card Rewards Likely To Spur Purchases

Shoppers planning to spend less this holiday season will use several strategies to save money. Looking for sales is among the most popular – 62 percent say that they will limit purchases to items that have deep sales, such as 25 percent off.

Fifty-seven percent say they will purchase less expensive brands while an equal percentage will seek out special shopping incentives such as free shipping.

Thirty-five percent say they will wait to shop in order to take advantage of last minute deals. Thirty-four percent say they will reduce the number of people they normally buy for, and 17 percent will “regift.”

Nearly one in five shoppers (18 percent) reported that extra credit card rewards would motivate them in making a holiday purchase.

“Finding the perfect gift is never easy, and this year shoppers will be looking for ones that also fit within their budgets,” said Ryan Garton, director of customer insights for Discover Financial Services.

Popular Gifts This Holiday Season

Discover card’s Holiday Shopping survey also highlights popular gifts and spending categories, and similar to in years past, what people want to receive this holiday season is not always consistent with what others plan to buy. Toys top the list for what shoppers plan to buy, while home entertainment items, such as music, books, DVDs and consumer electronics, rank high for what people would like to receive this year.





21% Toys       22% CDs/books/DVDs or video games
20% Consumer electronics       19% Consumer electronics
19% Apparel       17% Apparel
15% CDs/books/DVDs or video games       13% Home items
9% Home items       8% Travel
3% Travel       6% Jewelry
2% Jewelry       2% Toys

“Holiday shoppers looking for extra savings this year can take advantage of cash rewards from Discover,” said Garton. “Cardmembers can receive double Cashback Bonus on purchases made on their Discover card anywhere online or at department, clothing, shoe or jewelry stores. They can also receive additional Cashback Bonus at over 150 retailers through ShopDiscover, our exclusive online shopping mall.”

About the Discover Card Holiday Shopping Survey

Discover Card's Holiday Shopping Survey was conducted by telephone with a total of 1,008 nationally representative adults (504 males and 504 females). The research was conducted from November 12-15, 2009 by Opinion Research Corporation.

About Discover

Discover Financial Services (NYSE: DFS) is a leading credit card issuer and electronic payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company operates the Discover card, America's cash rewards pioneer, and offers student and personal loans, as well as savings products such as certificates of deposit and money market accounts. Its payments businesses consist of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in 185 countries and territories. For more information, visit

Heartland Payment Systems Shareholder Class Action Lawsuit Dismissed in US District Court
Judge Granted Heartland’s Motion to Dismiss with Prejudice

PRINCETON, N.J.--(BUSINESS WIRE)--Heartland Payment Systems® (NYSE: HPY), a leading provider of credit/debit/prepaid card processing, payroll, check management and payment services, today announced that on December 7, 2009, the United States District Court for the District of New Jersey, granted Heartland’s motion to dismiss the consolidated shareholder class action, titled In Re Heartland Payment Systems, Inc. Securities Litigation, which had been filed against Heartland, Robert O. Carr,

Heartland’s Chairman and Chief Executive Officer and Robert H.B. Baldwin, Jr., Heartland’s President and Chief Financial Officer. The case, which arose out of the breach to the company’s processing system previously disclosed by the Company on January 20, 2009, was dismissed in its entirety with prejudice.

About Heartland Payment Systems®

Heartland Payment Systems, Inc., a NYSE company trading under the symbol HPY, delivers credit/debit/prepaid card processing, payroll, check management and payment solutions to more than 250,000 businesses nationwide.

Heartland is the founding supporter of The Merchant Bill of Rights, a public advocacy initiative that educates merchants about fair credit and debit card processing practices. For more information, visit and

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HomeATM Headline Newsletter through December 11th

Compiled by Mitch Cobrin - COO HomeATM ePayment Solutions

For more extensive news and industry coverage please see our award winning blog or visit our corporate website.

Banks are offering more card-not-present security alerts, study says

A study by Javelin Strategies & Research shows sharp improvement in fraud prevention and identity detection made by U.S. financial institutions, including an increase of user-defined limits and alerts for online transactions.

Twitter, Amiando, Obopay, And Playfish Are Named Technology ...

Understand more about... mocoNews - MasterCard's MoneySend To Go Live This Month In U.S. · TechCrunch Euro Tour 08: Yes, even Belgium has startups ...

Will that be Visa, AMEX or Twitter, sir?

Sydney Morning Herald PayPal has become the de facto standard for online payments, which is very handy but still not much help when you're looking to buy something at the market.


HSBC's discomfort over the theft of client data from its private banking operations in Geneva by an IT insider has deepened as it emerges that the breach may have affected thousands of customers rather than single-digit figure initially claimed by the bank. More on this story:

iPhone Payments Smackdown: Square vs. Verifone

Twitter vet Jack Dorsey reacts to Verifone's announcement of their iPhone payments solution, PAYware Mobile, and clears the air around security issues.  Read more

MasterCard Worldwide to Strengthen Global Economic Connections ...

MasterCard(R) MoneySend(TM) to Make Money Transfers Simpler and Easier for Banks ... "MasterCard MoneySend removes barriers impeding the transfer of money

China's Central Bank To License Online Payment Platforms Ouyang told local media that in the non-cash economic age, it is important to develop online payment services. At the same time, third-party payment ...

Square payments say Apple's a competitor Rumours have swirled around about an Apple built “Paypal killer” for some time. Dorsey went on to say that he while Square is focusing on “the user ...

Ecommerce scandal: US Congress investigates Visa, MasterCard over online scam

Ecommerce Journal Last may the US Senate Committee on Commerce, Science, and Transportation started an investigation into the thousands of consumer complaints from online ...

First Data: Transactions up in November

Atlanta Business Chronicle SpendTrend tracks same store consumer spending via credit, signature debit, PIN debit and EBT cards at US merchant locations. Credit and signature debit was

VeriFone Rushes To Announce Square Competitor; Jack Dorsey Comments

TechCrunch (blog) The last thing they want is another PayPal to come along and blindside them. I just saw an announcement by VeriFone on their own Square competitor – an ...

Phishing Attacks Cost Millions Despite Low Success Rate

New research from Trusteer shows that while the majority of phishing attacks are unsuccessful, those that slip past security defenses are costing millions of dollars. With nearly half of those who click on links to phishing sites giving up their personal information, here are some tips on what you need to do to protect your enterprise. READ MORE >>

Western Union (WU) Delivers a 50% Dividend Increase and New $1 Billion Share ... (subscription) The Western Union Co.'s (NYSE: WU) Board of Directors agreed to a new three-year share repurchase program Wednesday worth $1 billion, according to the

Industry Reaction the New iPhone Payments Device, Square

Each week posts new discussions in our LinkedIn group where we encourage members to weigh in. This week we asked for reaction to the release of Square. Read more and jump into the debate!

Chip cards fail to prevent banking fraud boom

iT News By Charis Palmer Card-not-present (CNP) fraud, which involves the use of stolen credit and debit card details to make telephone and online payments,

MasterCard Worldwide to Strengthen Global Economic Connections ...

MasterCard® MoneySend(TM) to Make Money Transfers Simpler and Easier for Banks ... MasterCard MoneySend Enables Functional, Reliable Global Money Transfer

Protecting Mobile Data: Just Kill Me Now

Today's smartphones certainly promise more convenience and functionality. But for IT, these devices promise new nightmares about protecting the data they store. It's not merely contact data, but files, slides, traffic history, E-mail records, chat transcripts and almost anything else that can be done on a desktop and synched to a smartphone. Then there's the Grand Poobah of data protection night terrors: Geolocation. Geolocation is the phone's capability to tell any app on that phone—or anyone at all, really—the exact location of the phone virtually every minute it has power. Such data is relatively small in size and yet—tied into various other data points (especially time and date)—could be monstrously helpful to some while being stunningly destructive to others. But fear not, IT execs are thinking, there's no way such data could ever get out to unauthorized places, right? Sprint this month proved otherwise, as we discuss in this week's Guest Column on McAfee's Security Blog. Read more.

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