Feature Story: Twitter Attack Pushes Online Banking Trojan

Security Watch is reporting on one of the many reasons Kapersky Labs is calling for "mass adoption" of peripheral card readers for all Internet Banking users...browsers are just too dangerous and thus, simply put, websites cannot be trusted.

Twitter Attack Pushes Banking Trojan

Tripe DES DUKPT End to End Encryption vs. Typing sensitive data into a box in a browser Attackers are targeting Twitter users with a Trojan stealing online banking credentials, according to researchers. "The initial Trojan is downloaded to the victim machine by a malicious Java archive file," explained Dmitry Bestuzhev of Kaspersky Lab. "It has several malicious features, for example: spreading through USB devices; it disables Windows task manager, the regedit application and also notifications from Windows Security Center. Also it creates a copy of itself in the system with the name of Live Messenger. The criminals even included an anti-virtualization feature. The worm checks if the hard drive of infected system is virtualized or not. If found to be in a virtual system, the malicious code won't be executed." The malicious links being tweeted out come with the message "haha this is the funniest video ive EVER SEEN!" Researchers at F-Secure noticed the attack as well, and said the links in the tweets point to a page under pc-tv.tv. "This malware is very harmful since credit cards and online banking credentials are in the game," Bestuzhev blogged. "Please, be really careful especially with trend topics (searches) since in many cases they are being used by criminals."

Posted by Brian Prince on May 20, 2010 8:29 PM

Feature Story: Twitter Attack Pushes Online Banking Trojan

Security Watch is reporting on one of the many reasons Kapersky Labs is calling for "mass adoption" of peripheral card readers for all Internet Banking users...browsers are just too dangerous and thus, simply put, websites cannot be trusted.

Twitter Attack Pushes Banking Trojan

Tripe DES DUKPT End to End Encryption vs. Typing sensitive data into a box in a browser Attackers are targeting Twitter users with a Trojan stealing online banking credentials, according to researchers. "The initial Trojan is downloaded to the victim machine by a malicious Java archive file," explained Dmitry Bestuzhev of Kaspersky Lab. "It has several malicious features, for example: spreading through USB devices; it disables Windows task manager, the regedit application and also notifications from Windows Security Center. Also it creates a copy of itself in the system with the name of Live Messenger. The criminals even included an anti-virtualization feature. The worm checks if the hard drive of infected system is virtualized or not. If found to be in a virtual system, the malicious code won't be executed." The malicious links being tweeted out come with the message "haha this is the funniest video ive EVER SEEN!" Researchers at F-Secure noticed the attack as well, and said the links in the tweets point to a page under pc-tv.tv. "This malware is very harmful since credit cards and online banking credentials are in the game," Bestuzhev blogged. "Please, be really careful especially with trend topics (searches) since in many cases they are being used by criminals."

Posted by Brian Prince on May 20, 2010 8:29 PM

What Banks Should Know About Consumers’ Thoughts on Reg. E

May 21, 2010 03:51 PM Eastern Daylight Time  

Experts available to discuss who will, won’t opt in to overdraft protection and why

LOMBARD, Ill.--(BUSINESS WIRE)--As part of the Federal Reserve’s recent amendment to Regulation E, the Electronic Funds Transfer Act, consumers will be required to opt in for overdraft protection for debit and ATM transactions, beginning for new customers on July 1, 2010 and for existing customers on August 15, 2010.

Who is likely to opt in? A high percentage of customers with previous overdraft activity find value in overdraft protection.A recent study by Raddon Financial Group (RFG) showed that only nine percent of bank customers contribute 80 percent of banks’ non-sufficient funds (NSF) fees. Depending on most banks’ specific fee strategy and pricing structure, financial institutions stand to lose between 40 and 60 percent of annual overdraft income from this new regulation. Since most overdraft activity is isolated to a small group of consumers, it is important to understand how this group views overdraft protection services offered by financial institutions.

Seventeen percent of all households report that they are either “extremely likely” or “very likely” to opt in for overdraft coverage for debit card purchases and ATM withdrawals, but ATM/debit cardholders with overdraft activity are almost twice as likely to opt in for coverage than other consumer segments. Twenty-nine percent of ATM/debit cardholders with overdraft activity on their accounts will likely opt in. Frequent users of overdraft protection, those with seven or more occurrences in a year, are most likely to opt in to continue receiving this service.

Who won’t opt in?

Fifty-one percent of households report that they will not opt in because they have no need for overdraft coverage, as they never overdraft their accounts. For this reason, a segmented approach to communication is vital. Financial institutions are likely to spend more of their communications dollars with those most likely to find value in the service. In addition, in order to mitigate the loss of fee income from this new regulation, some financial institutions are assessing their checking product menu to determine if free checking is still a viable product.

The value proposition: It’s a free service that only costs when you need it.

Many consumers indicate they will opt-in because overdraft protection is “free until you need it.” Of households extremely to somewhat likely to opt in for overdraft coverage for debit card purchases and ATM withdrawals, 53 percent indicate that they would opt in because they do not intend to overdraft and the service is free if they don’t use it. Forty-six percent said they would opt in because they want to guard against the potential of having a transaction declined. Additionally, “a need for emergency cash” and “too busy to make sure funds are available” were reasons consumers who use overdraft protection will opt in to continue to receive overdraft protection on one-time debit transactions.

About RFG

RFG, a strategic business unit of Open Solutions Inc., has been providing research-based solutions exclusively to the financial services industry since 1983. RFG understands the industry and knows how consumers and businesses interact with financial institutions. By combining our practical know-how with best practices in research and analysis, RFG helps financial institutions manage their customer relationships and their organizations.

Contacts

For Raddon Financial Group

Anna Stanley, 251-990-3559

Permalink: http://www.businesswire.com/news/home/20100521006044/en/Banks-Consumers%E2%80%99-Thoughts-Reg.

What Banks Should Know About Consumers’ Thoughts on Reg. E

May 21, 2010 03:51 PM Eastern Daylight Time  

Experts available to discuss who will, won’t opt in to overdraft protection and why

LOMBARD, Ill.--(BUSINESS WIRE)--As part of the Federal Reserve’s recent amendment to Regulation E, the Electronic Funds Transfer Act, consumers will be required to opt in for overdraft protection for debit and ATM transactions, beginning for new customers on July 1, 2010 and for existing customers on August 15, 2010.

Who is likely to opt in? A high percentage of customers with previous overdraft activity find value in overdraft protection.A recent study by Raddon Financial Group (RFG) showed that only nine percent of bank customers contribute 80 percent of banks’ non-sufficient funds (NSF) fees. Depending on most banks’ specific fee strategy and pricing structure, financial institutions stand to lose between 40 and 60 percent of annual overdraft income from this new regulation. Since most overdraft activity is isolated to a small group of consumers, it is important to understand how this group views overdraft protection services offered by financial institutions.

Seventeen percent of all households report that they are either “extremely likely” or “very likely” to opt in for overdraft coverage for debit card purchases and ATM withdrawals, but ATM/debit cardholders with overdraft activity are almost twice as likely to opt in for coverage than other consumer segments. Twenty-nine percent of ATM/debit cardholders with overdraft activity on their accounts will likely opt in. Frequent users of overdraft protection, those with seven or more occurrences in a year, are most likely to opt in to continue receiving this service.

Who won’t opt in?

Fifty-one percent of households report that they will not opt in because they have no need for overdraft coverage, as they never overdraft their accounts. For this reason, a segmented approach to communication is vital. Financial institutions are likely to spend more of their communications dollars with those most likely to find value in the service. In addition, in order to mitigate the loss of fee income from this new regulation, some financial institutions are assessing their checking product menu to determine if free checking is still a viable product.

The value proposition: It’s a free service that only costs when you need it.

Many consumers indicate they will opt-in because overdraft protection is “free until you need it.” Of households extremely to somewhat likely to opt in for overdraft coverage for debit card purchases and ATM withdrawals, 53 percent indicate that they would opt in because they do not intend to overdraft and the service is free if they don’t use it. Forty-six percent said they would opt in because they want to guard against the potential of having a transaction declined. Additionally, “a need for emergency cash” and “too busy to make sure funds are available” were reasons consumers who use overdraft protection will opt in to continue to receive overdraft protection on one-time debit transactions.

About RFG

RFG, a strategic business unit of Open Solutions Inc., has been providing research-based solutions exclusively to the financial services industry since 1983. RFG understands the industry and knows how consumers and businesses interact with financial institutions. By combining our practical know-how with best practices in research and analysis, RFG helps financial institutions manage their customer relationships and their organizations.

Contacts

For Raddon Financial Group

Anna Stanley, 251-990-3559

Permalink: http://www.businesswire.com/news/home/20100521006044/en/Banks-Consumers%E2%80%99-Thoughts-Reg.

Merchant Warehouse to Exhibit Pay @ the Table at National Restaurant Association Show 2010

Solution allows restaurants, cafes and eateries opportunity to improve operational costs; consumers can keep an eye on cards during transaction

NRA Show 2010

BOSTON--(BUSINESS WIRE)--Merchant Warehouse, a premier provider of merchant accounts and credit card processing solutions will be showcasing the company’s innovative Pay @ The Table with BINsmart solution at the annual National Restaurant Association (NRA) Show 2010, taking place from May 22-25 at McCormick Place in Chicago, Ill. NRA offers over 65 free education sessions, non-stop culinary demonstrations covering food trends, cost savings, gluten-free menu development, guest acquisition & retention, “going green,” employee recruitment and many other topics that are vital to growing your top- and bottom-line results. In addition, Merchant Warehouse will be exhibiting its web-hosted TransPort application that allows POS developers to use the application with any operating system.

Who: Merchant Warehouse

What: National Restaurant Association Show 2010

Where: McCormick Place, Chicago, Ill.

When: May 22-25, 2010

Your order is up: Solution improves operational costs

Merchant Warehouse’s BINsmart solution is a cost-saving technology that helps small and mid-sized merchants maximize the value of every sale by reducing their overall payment processing costs. BINsmart helps merchants process transactions at the lowest possible cost by automatically identifying the card type being used in the transaction, and prompting the merchant for additional information or for a PIN number for debit cards. This sophisticated, yet simple solution minimizes or eliminates Interchange rates and fees by prompting the merchant for additional information or recommending PIN-debit transactions over credit whenever possible, which often results in savings up to 12 percent on those fees. Merchant Warehouse recently integrated this technology with Pay @ the Table terminals, secure wireless payment devices that bring payment to the customer in a fast, efficient and secure manner, allowing customers to pay with credit and debit cards at their table. Restaurant merchants can improve both the customer experience and their operational costs, by turning tables more quickly and creating more waitstaff efficiencies. This technology will be demonstrated at the Merchant Warehouse booth.

POS Development Application Comes to the Web

Merchant Warehouse will also be showcasing its web-hosted version of TransPort, which allows point-of-sale developers to remove the card processing function entirely from their software while retaining full functionality through a “transaction portal.” The newest version of TransPort allows any developer with an Internet browser to use the application. Like the original TransPort version, it is PA-DSS validated and it takes the developer out of scope for PA-DSS compliance. The application is available for use with all operating systems.

About Merchant Warehouse

Since 1998, Merchant Warehouse has set the standard for credit card processing by guaranteeing competitive pricing in merchant accounts, software, equipment, and providing dedicated, high quality customer service. Over 80,000 merchants later, the company continues to lead the industry with groundbreaking technology initiatives: MerchantWARE^®; BINsmart™; and MerchantWARE Mobile. Merchant Warehouse has been named the ETA 2009 ISO of the Year, Business Solutions’ Best Channel Vendor for 2009 & 2010 and is a two-time recipient of the Boston Business JournalPacesetter Award. Merchant Warehouse co-CEO, Henry Helgeson, was also named Ernst & Young Entrepreneur of the Year 2009 for New England. The company is committed to community and charitable involvement. For more information, please visit http://merchantwarehouse.com or follow us on Twitter at http://twitter.com/MWarehouse

Contacts

Merchant Warehouse

Marianne Rocco, 800-941-6557 x2051

Marketing Director

mrocco@merchantwarehouse.com

or

PAN Communications

Mike Sullivan, 978-474-1900

merchant@pancomm.com

Permalink: http://www.businesswire.com/news/home/20100521005108/en/Merchant-Warehouse-Exhibit-Pay-Table-National-Restaurant

Merchant Warehouse to Exhibit Pay @ the Table at National Restaurant Association Show 2010

Solution allows restaurants, cafes and eateries opportunity to improve operational costs; consumers can keep an eye on cards during transaction

NRA Show 2010

BOSTON--(BUSINESS WIRE)--Merchant Warehouse, a premier provider of merchant accounts and credit card processing solutions will be showcasing the company’s innovative Pay @ The Table with BINsmart solution at the annual National Restaurant Association (NRA) Show 2010, taking place from May 22-25 at McCormick Place in Chicago, Ill. NRA offers over 65 free education sessions, non-stop culinary demonstrations covering food trends, cost savings, gluten-free menu development, guest acquisition & retention, “going green,” employee recruitment and many other topics that are vital to growing your top- and bottom-line results. In addition, Merchant Warehouse will be exhibiting its web-hosted TransPort application that allows POS developers to use the application with any operating system.

Who: Merchant Warehouse

What: National Restaurant Association Show 2010

Where: McCormick Place, Chicago, Ill.

When: May 22-25, 2010

Your order is up: Solution improves operational costs

Merchant Warehouse’s BINsmart solution is a cost-saving technology that helps small and mid-sized merchants maximize the value of every sale by reducing their overall payment processing costs. BINsmart helps merchants process transactions at the lowest possible cost by automatically identifying the card type being used in the transaction, and prompting the merchant for additional information or for a PIN number for debit cards. This sophisticated, yet simple solution minimizes or eliminates Interchange rates and fees by prompting the merchant for additional information or recommending PIN-debit transactions over credit whenever possible, which often results in savings up to 12 percent on those fees. Merchant Warehouse recently integrated this technology with Pay @ the Table terminals, secure wireless payment devices that bring payment to the customer in a fast, efficient and secure manner, allowing customers to pay with credit and debit cards at their table. Restaurant merchants can improve both the customer experience and their operational costs, by turning tables more quickly and creating more waitstaff efficiencies. This technology will be demonstrated at the Merchant Warehouse booth.

POS Development Application Comes to the Web

Merchant Warehouse will also be showcasing its web-hosted version of TransPort, which allows point-of-sale developers to remove the card processing function entirely from their software while retaining full functionality through a “transaction portal.” The newest version of TransPort allows any developer with an Internet browser to use the application. Like the original TransPort version, it is PA-DSS validated and it takes the developer out of scope for PA-DSS compliance. The application is available for use with all operating systems.

About Merchant Warehouse

Since 1998, Merchant Warehouse has set the standard for credit card processing by guaranteeing competitive pricing in merchant accounts, software, equipment, and providing dedicated, high quality customer service. Over 80,000 merchants later, the company continues to lead the industry with groundbreaking technology initiatives: MerchantWARE^®; BINsmart™; and MerchantWARE Mobile. Merchant Warehouse has been named the ETA 2009 ISO of the Year, Business Solutions’ Best Channel Vendor for 2009 & 2010 and is a two-time recipient of the Boston Business JournalPacesetter Award. Merchant Warehouse co-CEO, Henry Helgeson, was also named Ernst & Young Entrepreneur of the Year 2009 for New England. The company is committed to community and charitable involvement. For more information, please visit http://merchantwarehouse.com or follow us on Twitter at http://twitter.com/MWarehouse

Contacts

Merchant Warehouse

Marianne Rocco, 800-941-6557 x2051

Marketing Director

mrocco@merchantwarehouse.com

or

PAN Communications

Mike Sullivan, 978-474-1900

merchant@pancomm.com

Permalink: http://www.businesswire.com/news/home/20100521005108/en/Merchant-Warehouse-Exhibit-Pay-Table-National-Restaurant

RewardsNow Gets $7.5 Million Investment from Edison Venture Fund

Leading Financial Services and Loyalty Program Provider RewardsNOW Receives $7.5 Million Investment from Edison Venture Fund

DOVER, N.H.--(BUSINESS WIRE)--RewardsNOW has finalized a $7.5 million investment from Edison Venture Fund, further positioning the customer loyalty and financial services provider for client growth and expansion of the services it offers.

“The investment will accelerate RewardsNOW’s ability to broadly expand its program capabilities and support to meet client needs”

RewardsNOW provides customer loyalty programs to more than 300 financial institutions. Founded in 1997, RewardsNOW designs, implements and manages turnkey direct marketing and loyalty programs for the full range of financial services including credit cards, debit cards, loans, deposits and online banking.

RewardsNOW CEO, Steven VanFleet, called the timing of this investment “perfect from a market perspective,” adding that RewardsNOW is seeing a strong resurgence in financial institutions seeking loyalty and reward solutions as the economy strengthens. “The investment will accelerate RewardsNOW’s ability to broadly expand its program capabilities and support to meet client needs,” VanFleet said.

“The next generation of loyalty programs requires a provider who can efficiently and cost-effectively integrate the latest offerings surrounding enterprise loyalty, merchant-funded rewards, and broad-based redemption options,” said VanFleet. “This must be supported by world-class expert consulting and a full array of consumer communication tools and channels. This investment allows us to continue to meet that challenge.”

Michael Balmuth, Edison Venture Fund General Partner, and Rick Auletta, Edison Director Network member, will join RewardsNOW’s Board of Directors. Auletta is Vice President of Sales for Edison portfolio company, IPP. VanFleet said Edison’s strategic counsel and experience at accelerating the growth of financial technology companies will be instrumental to RewardsNOW’s success.

“We have been impressed by the vision and strong leadership, as evidenced by RewardsNOW’s impressive growth and customer satisfaction,” stated Balmuth, “and look forward to our role in helping to build on that record of performance.”

Edison has invested in 33 financial technology businesses. Active portfolio companies include Billtrust, FolioDynamix, Gain Capital, Liberty Tax, Neat, Portico, Scivantage and TraderTools. Past investments also included Best Software, DPM, EdgeTrade, E-Transport and Princeton Financial Systems.

About RewardsNOW

RewardsNOW is a premier provider of marketing services for the financial industry. The company’s turnkey loyalty solutions include configurable web-based loyalty platform, marketing communications, analytics/ROI reporting, rewards catalog/fulfillment, merchant network management, design and program management/consultation and customer support. These products and services generate incremental profits from increased member acquisition, increased product usage, and lower customer attrition rates. RewardsNOW is based in Dover, New Hampshire. For more information, call 800.240.4814, ext. 232, or visit www.rewardsnow.com.

About Edison Venture Fund

Established in 1986, Edison partners with entrepreneurs, service providers and other financing sources to build successful companies. Edison provides capital and value-added services to late stage ($5 to 20 million revenue), information technology businesses. Initial investments range from $5 to 8 million. Edison typically serves as the sole or lead investor in financings up to $10 million. In addition to providing expansion capital, Edison funds management buyouts, recapitalizations, spinouts and secondary stock purchases.

Edison’s investment professionals are based in Lawrenceville, NJ, New York, NY, Needham, MA and McLean, VA. Industry specialties include application software, communications, financial technology, interactive marketing, and healthcare IT. Edison’s successes include ACT!, Axent, Dendrite, Mapics, POMS, Visual Networks, VirtualEdge, Vocus and many other information technology leaders, which have a combined market value exceeding $5 billion. Edison currently has $550 million under management and is actively making new investments. www.edisonventure.com.

Contacts

RewardsNOW

Anne Gaudette, 603-516-3440 ext. 232

agaudette@rewardsnow.com

or

Dux Public Relations

Kristine Tanzillo, 903-865-1078

Kristine@duxpr.com

Permalink: http://www.businesswire.com/news/home/20100521005121/en/Leading-Financial-Services-Loyalty-Program-Provider-RewardsNOW

RewardsNow Gets $7.5 Million Investment from Edison Venture Fund

Leading Financial Services and Loyalty Program Provider RewardsNOW Receives $7.5 Million Investment from Edison Venture Fund

DOVER, N.H.--(BUSINESS WIRE)--RewardsNOW has finalized a $7.5 million investment from Edison Venture Fund, further positioning the customer loyalty and financial services provider for client growth and expansion of the services it offers.

“The investment will accelerate RewardsNOW’s ability to broadly expand its program capabilities and support to meet client needs”

RewardsNOW provides customer loyalty programs to more than 300 financial institutions. Founded in 1997, RewardsNOW designs, implements and manages turnkey direct marketing and loyalty programs for the full range of financial services including credit cards, debit cards, loans, deposits and online banking.

RewardsNOW CEO, Steven VanFleet, called the timing of this investment “perfect from a market perspective,” adding that RewardsNOW is seeing a strong resurgence in financial institutions seeking loyalty and reward solutions as the economy strengthens. “The investment will accelerate RewardsNOW’s ability to broadly expand its program capabilities and support to meet client needs,” VanFleet said.

“The next generation of loyalty programs requires a provider who can efficiently and cost-effectively integrate the latest offerings surrounding enterprise loyalty, merchant-funded rewards, and broad-based redemption options,” said VanFleet. “This must be supported by world-class expert consulting and a full array of consumer communication tools and channels. This investment allows us to continue to meet that challenge.”

Michael Balmuth, Edison Venture Fund General Partner, and Rick Auletta, Edison Director Network member, will join RewardsNOW’s Board of Directors. Auletta is Vice President of Sales for Edison portfolio company, IPP. VanFleet said Edison’s strategic counsel and experience at accelerating the growth of financial technology companies will be instrumental to RewardsNOW’s success.

“We have been impressed by the vision and strong leadership, as evidenced by RewardsNOW’s impressive growth and customer satisfaction,” stated Balmuth, “and look forward to our role in helping to build on that record of performance.”

Edison has invested in 33 financial technology businesses. Active portfolio companies include Billtrust, FolioDynamix, Gain Capital, Liberty Tax, Neat, Portico, Scivantage and TraderTools. Past investments also included Best Software, DPM, EdgeTrade, E-Transport and Princeton Financial Systems.

About RewardsNOW

RewardsNOW is a premier provider of marketing services for the financial industry. The company’s turnkey loyalty solutions include configurable web-based loyalty platform, marketing communications, analytics/ROI reporting, rewards catalog/fulfillment, merchant network management, design and program management/consultation and customer support. These products and services generate incremental profits from increased member acquisition, increased product usage, and lower customer attrition rates. RewardsNOW is based in Dover, New Hampshire. For more information, call 800.240.4814, ext. 232, or visit www.rewardsnow.com.

About Edison Venture Fund

Established in 1986, Edison partners with entrepreneurs, service providers and other financing sources to build successful companies. Edison provides capital and value-added services to late stage ($5 to 20 million revenue), information technology businesses. Initial investments range from $5 to 8 million. Edison typically serves as the sole or lead investor in financings up to $10 million. In addition to providing expansion capital, Edison funds management buyouts, recapitalizations, spinouts and secondary stock purchases.

Edison’s investment professionals are based in Lawrenceville, NJ, New York, NY, Needham, MA and McLean, VA. Industry specialties include application software, communications, financial technology, interactive marketing, and healthcare IT. Edison’s successes include ACT!, Axent, Dendrite, Mapics, POMS, Visual Networks, VirtualEdge, Vocus and many other information technology leaders, which have a combined market value exceeding $5 billion. Edison currently has $550 million under management and is actively making new investments. www.edisonventure.com.

Contacts

RewardsNOW

Anne Gaudette, 603-516-3440 ext. 232

agaudette@rewardsnow.com

or

Dux Public Relations

Kristine Tanzillo, 903-865-1078

Kristine@duxpr.com

Permalink: http://www.businesswire.com/news/home/20100521005121/en/Leading-Financial-Services-Loyalty-Program-Provider-RewardsNOW

PlainsCapital vs. Hillary Machinery: Settled out of Court

PlainsCapital Bank has apparently decided to back down and has reached a settlement with Hillary Machinery over the high profile online banking case involving the cybertheft of almost a million dollars via ACH and wire transfers.  

From Bank Info Security: Current regulations, including Regulation E and Regulation Z, require financial institutions to reimburse consumers that fall victim to fraud, but financial institutions are not required to do the same for commercial banking customers. The PlainsCapital Bank case is one of at least two similar cases pending in courts across the country, but it is the only case where the bank sued its customer.

You'll remember (see related articles below) that Hillary Machinery had about $800k stolen from their account and although $600k was eventually recovered, the bank refused to reimburse Hillary Machinery for the outstanding $200,000.



So Hillary sued PlainsCapital and ironically, PlainsCapital Bank sued Hillary.  As I reported a couple days ago, a judge recently denied a motion by PlainsCapital to go have the case decided by arbitration.



Judge Rejects Arbitration for Online Banking Security Case



Read more: http://pindebit.blogspot.com/2010/05/consumers-need-more-than-reasonable.html#ixzz0oaAeIAQI



Apparently the spectre of a high-profile jury trial to determine if "reasonable security" was in place apparently didn't sit well with the Texas bank...thus they settled.   Of course, the terms of the settlement weren't disclosed but I'm guessing that Hillary got their missing $200k back and then some.



Here's more:

Terms of the settlement have not been disclosed, but it comes just days after the courts threw out a motion by the bank to hold the hearings in private. Recent research from Guardian Analytics and Ponemon Institute found that the US banking industry is failing to protect its small business customers from a destructive epidemic of cyberfraud that is sweeping the nation.  - Finextra

Texas Bank Sues Victim of Cybertheft Incident

Jan 28, 2010

The bank sought to absolve itself from blame in the heist by stating that the unauthorized wire transfer orders had been placed by someone using valid Internet banking credentials belonging to Hillary Machinery. ...

http://pindebit.blogspot.com/

Biz Vs. Bank: War of Words Heats Up

Mar 30, 2010

In what's shaping up to be a heavyweight legal bout between a bank and its business customer, the attorney for Plano, TX-based Hillary Machinery accuses PlainsCapital Bank of “dodging and weaving” around the fundamental issue of ...

http://pindebit.blogspot.com/

Read more: http://pindebit.blogspot.com/2010/05/kaspersky-co-founder-eugene-kaspersky.html#uds-search-results#ixzz0oa8l5Tby

Related articles by Zemanta

• Kaspersky Co-Founder Eugene Kaspersky Recommends using Peripheral Card Readers for ALL Internet Banking Users (pindebit.blogspot.com)


• Customer Satisfaction with Online Banking Slips (pindebit.blogspot.com)


• Trusteer Says 73% of Online Banking Customers Stupid (pindebit.blogspot.com)

PlainsCapital vs. Hillary Machinery: Settled out of Court

PlainsCapital Bank has apparently decided to back down and has reached a settlement with Hillary Machinery over the high profile online banking case involving the cybertheft of almost a million dollars via ACH and wire transfers.  

From Bank Info Security: Current regulations, including Regulation E and Regulation Z, require financial institutions to reimburse consumers that fall victim to fraud, but financial institutions are not required to do the same for commercial banking customers. The PlainsCapital Bank case is one of at least two similar cases pending in courts across the country, but it is the only case where the bank sued its customer.

You'll remember (see related articles below) that Hillary Machinery had about $800k stolen from their account and although $600k was eventually recovered, the bank refused to reimburse Hillary Machinery for the outstanding $200,000.



So Hillary sued PlainsCapital and ironically, PlainsCapital Bank sued Hillary.  As I reported a couple days ago, a judge recently denied a motion by PlainsCapital to go have the case decided by arbitration.



Judge Rejects Arbitration for Online Banking Security Case



Read more: http://pindebit.blogspot.com/2010/05/consumers-need-more-than-reasonable.html#ixzz0oaAeIAQI



Apparently the spectre of a high-profile jury trial to determine if "reasonable security" was in place apparently didn't sit well with the Texas bank...thus they settled.   Of course, the terms of the settlement weren't disclosed but I'm guessing that Hillary got their missing $200k back and then some.



Here's more:

Terms of the settlement have not been disclosed, but it comes just days after the courts threw out a motion by the bank to hold the hearings in private. Recent research from Guardian Analytics and Ponemon Institute found that the US banking industry is failing to protect its small business customers from a destructive epidemic of cyberfraud that is sweeping the nation.  - Finextra

Texas Bank Sues Victim of Cybertheft Incident

Jan 28, 2010

The bank sought to absolve itself from blame in the heist by stating that the unauthorized wire transfer orders had been placed by someone using valid Internet banking credentials belonging to Hillary Machinery. ...

http://pindebit.blogspot.com/

Biz Vs. Bank: War of Words Heats Up

Mar 30, 2010

In what's shaping up to be a heavyweight legal bout between a bank and its business customer, the attorney for Plano, TX-based Hillary Machinery accuses PlainsCapital Bank of “dodging and weaving” around the fundamental issue of ...

http://pindebit.blogspot.com/

Read more: http://pindebit.blogspot.com/2010/05/kaspersky-co-founder-eugene-kaspersky.html#uds-search-results#ixzz0oa8l5Tby

Related articles by Zemanta

• Kaspersky Co-Founder Eugene Kaspersky Recommends using Peripheral Card Readers for ALL Internet Banking Users (pindebit.blogspot.com)


• Customer Satisfaction with Online Banking Slips (pindebit.blogspot.com)


• Trusteer Says 73% of Online Banking Customers Stupid (pindebit.blogspot.com)

MasterCard Urges House and Senate Conferees to Consider Severe Consequences of Durbin Amendment for American Consumers

PURCHASE, N.Y.--(BUSINESS WIRE)--Now that the Senate has approved The Financial Regulatory Reform Bill, MasterCard urges House and Senate conferees to reject the amendment tacked on by Senator Dick Durbin, which will hurt the people and businesses it is supposed to protect. Consumers, community banks and credit unions will all pay if this thinly-veiled attempt by merchants to increase their profitability at their customers’ expense becomes law.

“What this amendment does is make debit costlier and shopping more complicated for consumers, while letting merchants reap the benefits of card acceptance at a bargain-basement price.”

“The amendment is a shrewd but cynical approach to getting American consumers to pay big-box merchants’ fair share for the benefits these merchants get from electronic payments. There’s a price-tag on this bill, and it will be paid by the American consumer,” said Noah Hanft, MasterCard general counsel.

“If American consumers have any doubt about who will pay the bill, they should ask Australian consumers, who saw their annual fees rise significantly and rewards shrink after the government there put artificial controls on interchange fees. At the same time, there’s no evidence that merchants there lowered prices to reflect the cut in fees.

“The amendment is ill advised and will end up hurting the same people the larger bill aims to protect so we urge Conferees to consider its severe consequences for consumers,” Hanft said.

This amendment was tacked on to the Senate version of the Financial Regulatory Reform Bill at the last minute, with no committee hearing to discuss its impacts and complexities. In a recent report prepared at the request of Congress, the General Accounting Office recognized that regulating interchange fees presents significant challenges, and could hurt both consumers and merchants.

“We believe that many of the Senators who voted for this amendment now understand that it will harm consumers and punish banks on Main Street because the ‘carve-out’ for banks with assets below $10 billion is a sham,” Hanft said. “What this amendment does is make debit costlier and shopping more complicated for consumers, while letting merchants reap the benefits of card acceptance at a bargain-basement price.

“The real harm for consumers and small businesses, beyond just losing rewards, will likely be higher annual fees, per transaction charges to use a debit card, less access to credit and for many consumers, the end of free checking accounts.”

Because the interchange price controls also extend to prepaid cards, the amendment would likely result in significant harm to millions of Americans who are unbanked and underprivileged and rely on prepaid cards for government benefits like social security payments or food stamps, or even their paycheck.

“Consumers could also be forced to spend more than they planned if they don't have cash in their pocket and the merchant enforces a minimum at the register, or they could be told the merchant doesn’t accept their chosen card anymore,” Hanft added.

About MasterCard Worldwide

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes over 22 billion transactions each year, and provides industry-leading analysis and consulting services to financial-institution customers and merchants. Powered by the MasterCard Worldwide Network and through its family of brands, including MasterCard®, Maestro® and Cirrus®, MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to www.mastercard.com. Follow us on Twitter: @mastercardnews.

Contacts

MasterCard Worldwide

Sharon Gamsin, 914-249-5622

sgamsin@mastercard.com

or

Jim Issokson, 914-249-6286

james_issokson@mastercard.com

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