MEMPHIS, Tenn. -- Following last month's increase in ownership of Primary Payment Systems, Inc., Concord EFS, Inc. (Nasdaq: CEFT), is expanding the deposit risk management services it offers through the majority-owned subsidiary.
The combined company's risk management products will provide the financial services and retail industries with tools to reduce deposit account and securities account fraud. Primary Payment Systems' products are marketed to financial institutions directly and through Concord's recently-acquired STAR network, the largest PIN-secured debit network in the U.S.
In April, Concord increased its ownership position in Primary Payment Systems to 85 percent through the purchase of newly-issued shares, which largely funded Primary Payment Systems' acquisition of Wally Industries, Inc. (doing business as WJM Technologies), a developer of new account fraud detection systems.
Primary Payment Systems operates and safeguards a database, currently composed of 145 million deposit accounts, which provides participating financial institutions with information on potentially fraudulent checks or high-risk accounts. WJM provides front-end tools to help financial services and other firms identify potentially fraudulent accounts before they are opened and activated. Through its Early Warning software product, WJM currently screens over 70 percent of all new banking customer relationships in the U.S.
"Deposit account fraud creates enormous expense for the financial services industry, but most risk management services have traditionally focused on loan risk rather than deposit risk," said Edward A. Labry III, Concord president. "Primary Payment Systems compiles, protects, and facilitates access to financial institutions' pooled account information to help them avoid fraud losses. With WJM's systems, this service becomes even more proactive, providing participants with the most complete information available to help them manage their account risk."
