From: dlv@bwalk.dm.com (Dr.Dimitri Vulis KOTM)
Date: Thu, 10 Oct 1996 21:30:17 -0700 (PDT)
To: cypherpunks@toad.com
Subject: [NEWS] Crypto-relevant wire clippings
Message-ID: <2F0LVD12w165w@bwalk.dm.com>
MIME-Version: 1.0
Content-Type: text/plain


It seems that this batch didn't make it to the list, so I'm trying again...

News Release (Netscape): Monday, October 7, 1996

Netscape to Use CyberCash Technology

Netscape Communications Corporation (NASDAQ: NSCP) and CyberCash, Inc. (NASDAQ:
CYCH) today announced a technology and marketing relationship to broaden
payment options for Internet consumers. As part of the agreement, CyberCash has
licensed its CyberCoin Internet payment technology to Netscape. Netscape will
bundle its technology into future versions of Netscape products, including
Netscape LivePayment server software for online payment processing.

The two companies will also collaborate on including future CyberCash payment
services, such as CyberCash's electronic check services, into future Netscape
commerce offerings. Netscape and CyberCash plan to jointly market these
Internet payment solutions to consumers and businesses, and will work together
on efforts to accelerate the deployment of Secure Electronic Transactions (SET)
credit card payment protocol in the marketplace.

"We have had customer demand for small value payment technology particularly
from the professional information publishing industry -- the integration of
CyberCash's CyberCoin with Netscape's commerce solutions provides our customers
with a way to complete small transactions over the Internet," said Srivats
Sampath, vice president of marketing for server, tools and applications at
Netscape. "By offering a range of payment options for businesses and consumers,
Netscape and CyberCash will help expand the range of goods and services
available in the electronic marketplace."

"Combined with Netscape's customer base, CyberCoin is filling a need in the
marketplace for small payment processing," said Denis Yaro, executive vice
president, products and operations at CyberCash. "This is a huge step in our
efforts to bring Internet transaction technology to consumers and businesses
and to increase online inventory, making the virtual mall a reality."

"We are pleased to see this agreement between Netscape and CyberCash," said
Chuck White, senior vice president of First Data Card Services Group's
Electronic Funds Services unit. "The relationship between Netscape and
CyberCash will make it easier to deliver integrated payment solutions to our
client financial institutions, and their merchant customers that are using
Netscape LivePayment."

CyberCoin is a payment service which permits online purchases for items costing
between 25 cents and $10.00. This new payment solution opens up significant
opportunities for merchants to market low cost, high value items such as news
and information, graphics, games and music. It also allows merchants to
unbundle larger product offerings, and sell them in smaller increments.
Financial institutions to offer the CyberCoin service include First Union Bank,
First USA Paymentech, Michigan National Bank and First Data Corp.

Bundling CyberCash's CyberCoin technology into future releases of Netscape's
LivePayment point-of-sale software will enable online businesses to accept
multiple payment methods and implement new pricing and business models.
Netscape LivePayment will integrate this new payment functionality seamlessly
and cost-effectively, providing business people with administration and
configuration controls with flexible logging reports, and a variety of sample
merchant applications to minimize the start-up development costs of merchants.
Both Netscape and CyberCash will market Netscape LivePayment software to
businesses looking to develop or expand online distribution channels.

Netscape plans to integrate CyberCoin into future versions of Netscape
Navigator client software, which includes technology that streamlines
consumers' shopping experience by providing a uniform interface for Internet
purchases and transactions. Similar to a real wallet, this technology will
organize into one place a user's credit card numbers, shipping addresses,
digital IDs, electronic receipts and other payment instruments needed to
purchase goods and services on the Internet.

Netscape and CyberCash will coordinate their efforts on SET to assure
interoperability between their credit card-related electronic commerce
implementations. Netscape was one of the principal architects of the SET
specifications proposed by Visa International and MasterCard International.
Committed to being among the first to deliver SET-compliant products to the
marketplace, both Netscape and CyberCash will also collaborate with other
important industry leaders in an effort to facilitate SET's arrival in the
shortest possible timeframe. About Netscape Netscape Communications Corporation

(NASDAQ: NSCP) is a leading provider of open software for linking people and
information over enterprise networks and the Internet. The company offers a
full line of clients, servers, development tools and commercial applications to
create a complete platform for next-generation, live online applications.
Netscape Communications Corporation is based in Mountain View, California.

About CyberCash

CyberCash, Inc., (NASDAQ: CYCH), of Reston, Virginia, founded in August 1994,
is a leading developer of software and service solutions for secure financial
transactions over the Internet. The CyberCash system is designed to allow banks
to offer secure Internet payments to their customers. CyberCash works with
virtually all financial processing institutions, and is currently working with
VISA and MasterCard to develop and implement the Secure Electronic Transaction
(SET) protocol for online credit card transactions. The company's initial
service, which handles payments using major credit cards, was introduced in
April 1995.

CyberCoin, the company's innovative micropayment service that enables cash
transactions, was launched on Sept. 30, 1996. CyberCash's electronic check
service is expected to be released in Q4, 1996.



Edge: Tuesday, October 8, 1996

VeriFone Introduces Personal ATM and VeriSmart

VeriFone, Inc., Monday announced plans to bring the convenience of a bank
automatic teller machine into the homes of millions of consumers around the
world, enabling them to replace cash and access dozens of personal services
anytime, anywhere, using telephones, televisions, personal computers and other
low-cost devices and information appliances.Announced Monday at the ABA Bank
Card Conference, VeriFone unveiled plans to introduce a low-cost, palm-sized,
smart card reader/writer called the Personal ATM (P-ATM). The P-ATM will
connect to any standard telephone line, allowing consumers to interact with
their bank account to download cash,' securely and conveniently in the privacy
of the home or office.

In addition, leveraging VeriFone's leadership in Internet commerce, the P-ATM
will also interface with the VeriFone vWallet, and any stored-value card
scheme, enabling consumers to make purchases over the Internet, download funds
from their bank onto their smart card, transfer funds between accounts, and
perform on-line transactions between consumers and merchants. VeriFone also
revealed the development of the VeriSmart System architecture, which is
expected to accelerate consumer adoption of smart card applications. The
VeriSmart System will integrate a low-cost personal ATM device, a powerful set
of software applications that lets consumers securely interact with any
provider offering smart card services, and a comprehensive package of support
services.

Applications might include the ability to download electronic cash from their
bank, instantly receive rewards from loyalty programs, or provide selected
healthcare information to their doctor or pharmacist.

Six leading technology companies -- CIDCO, Gemplus, Key Tronic, Mondex
International, Scientific Atlanta and WebTV Networks, Inc. -- have announced
their support for VeriSmart and plan to work with VeriFone to develop further
technologies around the system.

"We are taking an aggressive role in developing the infrastructure for smart
card applications with our plans to introduce the Personal ATM and the
VeriSmart System," said Hatim Tyabji, chairman, president and CEO of VeriFone.

"VeriSmart will be the first technology that is card-scheme and hardware-device
independent, uniting all the elements in a truly end-to-end solution. We plan
to actively layer VeriSmart technology into our merchant point-of-sale
terminals and Omnihost client-server systems, to create solutions that bridge
all VeriFone markets worldwide. This action unveils the third element in our
three pronged strategy -- traditional debit/credit business, Internet commerce
and now consumer smart card technologies -- expanding VeriFone's leadership in
secure payments technologies worldwide."

In addition, American Express, GTE, Hewlett-Packard Company, MasterCard, NIPSCO
Industries, Inc., Sparbanken Bank (BABS), Sears Payment Systems (SPS), and
Wells Fargo have all announced support of the VeriSmart System.

The VeriSmart System is being designed to electronically link consumers to
their banks, telephone and utility companies, retail merchants and other
personal services. Using any one of a variety of smart card-ready devices, such
as the Personal ATM, telephone, PC, or set-top-box, a consumer will access
numerous personal services and interact with multiple stored-value card
schemes, loyalty programs, identification, and health care information.

The VeriSmart System will provide end-to-end security for all communications
between the access device and the smart card applications on the VeriSmart
server, ensuring data integrity of financial transactions and other
confidential information.

"This is the beginning of a new era for smart card applications," said Tom
Kilcoyne, general manager of VeriFone's Consumer Systems Division.

"The industry has been waiting for a compelling, cost-effective solution that
enables financial institutions, and a broad range of consumer service
providers, to move aggressively to build smart card applications. Endorsement
in the consumer market from these respected companies, combined with VeriFone's
global leadership position and expertise in the secure payment transaction
market, supports our belief in VeriSmart as a powerful system that can
accelerate development of the market for smart cards worldwide."

Wide Industry Support VeriFone's Consumer Systems Division's effort to enhance
the market for smart cards is drawing the support of consumer market leaders
that will contribute in pivotal areas of the system.

CIDCO Inc., the world's leading producer of subscriber terminal equipment that
supports intelligent network services being offered by telephone operating
companies, has formed an alliance with VeriFone to incorporate VeriSmart
technology into its products and to work with VeriFone on future projects.

"CIDCO is excited to be collaborating with VeriFone in the explosive consumer
smart card market," said Paul Locklin, CIDCO president and CEO. "The VeriSmart
system brings a strong added value to the products we market to our regional
Bell operating company customers." "VeriFone and Gemplus have had a close and
long-standing relationship over the years and we are proud to be part of this
latest breakthrough solution," said Marc Lassus, Gemplus CEO. "As a market
leader, our strategy has been to partner with companies that enable us to offer
the best-of-breed solutions, and our participation in VeriSmart extends this
strategy to the consumer market for smart cards."

"As consumers become more accepting of smart cards, initiatives like VeriSmart
will make it easier for banks and other institutions to introduce new products
and services that provide greater choice and convenience," said Ruann F. Ernst,
general manager of HP's Financial Services Business Unit.


Associated Press: Tuesday, October 8, 1996

Bankers Hope to Control 'Electronic Cash'

By E. SCOTT RECKARD

The largest organization of U.S. banks wants "smart cards" and "electronic
cash" limited to the banking industry.

The American Bankers Association, in its first official position on how
electronic cash should evolve, says such "stored-value" cards should be issued
only by regulated institutions with direct access to Federal Reserve payment
services -- namely banks, thrifts and credit unions.

The bankers' recommendation comes as several software companies are also
jockeying to provide payment systems over the Internet.

At a convention here, the bankers trade group warned that users of prepaid
phone cards have been ripped off by fly-by-night issuers. The same could happen
in storing funds for general use on plastic cards like credit cards or in
computers, the bankers said in issuing their report Sunday.

"If a nonbank issuer of stored value fails, consumers could be left holding the
bag - an empty bag," said James M. Culbertson, president for the past year of
the ABA and chairman of First National Bank in Asheboro, N.C.

The bankers' group acknowledged that some day computer companies may get into
the business of electronic cash. But if that happens, banks want the computer
companies to be subject to the same regulatory scrutiny that applies to banks
and thrifts.

While seeking exclusive rights to smart cards and their ilk, banks have
resisted the idea that conventional bank regulations should apply to electronic
cash. They oppose a proposal to apply the Federal Reserve's "Regulation E" to
stored-value cards. That regulation requires banks to offer written
confirmations of ATM transactions. Bankers say such a requirement would make
stored-value cards too expensive to issue.

And in pilot projects, banks have not treated the smart cards as deposits that
are insured by the Federal Deposit Insurance Corp. That means the consumer does
not earn interest on the unused cash backing up the card and the banks do not
have to set aside reserves as they would for a conventional deposit.

A smart card has a computer chip that stores information, including how much
the consumer has deposited. As a purchase is made, the amount is automatically
deducted from the balance in the card's memory.

In the future, consumers will be able to transfer cash to smart cards from
their home computers or at an automatic teller machine at a bank. Electronic
money is also being tested to pay for purchases over the Internet.

The move away from paper-based transactions has been a boon in many ways for
banks. The replacement of manual check-processing by electronically stored
images of the checks has probably paid off more for banks than any other
high-tech innovation, bank technology consultant Charles O. Hinely said in an
interview.

But banks could be pushed out of the payment system altogether if they don't
quickly get into computerized services and transactions, said Don Tapscott,
author of "The Digital Economy."

"If you don't, you're basically toast, and punishment is swift," he told the
bankers.

The trade group's new president, Walter A. Dods Jr., said he would work to
improve the image of bankers, whom he described as unfairly maligned despite
the financial support and considerable charity work they provide their
communities.

"But what do we get in return? We get legislation to limit ATM fees. We get a
reader telling Business Week recently that 'banks are just sucking us dry,"'
said Dods, the chairman of First Hawaiian Bank.


Washington Post: Wednesday, October 9, 1996

AT&T Adds On-Line Card Protection

By David S. Hilzenrath

When it comes to using credit cards on-line, many Internet businesses say their
biggest fear is fear itself.

Citing consumer concerns about the security of credit-card numbers as an
impediment to on-line commerce, two industry powerhouses have introduced
guarantees in an effort to overcome what they call unwarranted anxieties.

AT&T Corp. Tuesday said it would indemnify holders of its own credit card
against fraud when they use AT&T security software to shop at World Wide Web
sites that AT&T maintains for its business clients. That means AT&T would
assume responsibility for the customer's usual $50 deductible.

America Online Inc. said last month that it would assume responsibility for the
deductible when subscribers shop at on-line retailers that have been certified
as meeting its own customer-service standards. That would include about 50 of
the more than 250 merchants on-line with AOL, which only recently began the
evaluation process, said Michael Minigan, vice president of marketing for AOL's
interactive-marketing unit.

``We think that this is a way to jump-start the industry for both businesses
and consumers,'' said Kathleen Earley, vice president of AT&T's EasyCommerce
Services for businesses.

Through the power of the AT&T name and the security guarantee, ``we can help
customers overcome any concerns that they may have,'' Earley said.

AT&T introduced a different guarantee in March, promising that holders of its
Universal Card who also use AT&T as their on-ramp to the Internet would not be
held liable if their credit cards were compromised anywhere in cyberspace.

AT&T said it didn't think the guarantee would cost it much money because the
risk of a security breach is so small.

Many analysts and retailers agree that the burgeoning business of electronic
commerce is battling a perception problem. Concerns about hackers stealing
credit-card numbers on-line have spawned a new industry of companies dedicated
to making on-line transactions secure through the use of encryption.

``There's still a reluctance to use credit cards on-line,'' said David Simons,
managing director of Digital Video Investments, which studies the Internet for
institutional investors.

``It's irrational because there's probably a greater chance of theft or fraud
by giving your credit card out to an individual on an 800 number or ... the
old-fashioned way, over the counter.''

``This is strictly a perception issue,'' said Jeff Bezos, founder and chief
executive of Amazon.Com, an Internet-based bookstore that handles thousands of
sales a day.

``It's so much easier to go through a trash can or dumpster and get credit-card
numbers than it is to break the encryption schemes that are used on the
Internet.''

Still, Bezos said there is evidence that perceptions are changing. When
Amazon.Com opened for business 15 months ago, about half of its customers opted
to provide their credit-card numbers over the phone instead of over the
Internet. Now, 85 percent complete the transactions on-line, Bezos said.


AP Online: Tuesday, October 8, 1996

Bankers Shrug Off Cybertalk

BY E. SCOTT RECKARD

HONOLULU-- Go high-tech or wither, speakers as auspicious as Federal Reserve
Chairman Alan Greenspan told the 1,100-strong American Bankers Association
convention.

''If you don't, you're basically toast, and punishment is swift,'' agreed
convention speaker Don Tapscott, author of ''The Digital Economy.''

You might think conventioneers from the largest organization of U.S. banks
would all be rushing to be first in online banking, computerized marketing to
customers, and other services and automated processes.

You would be wrong, especially at smaller banks, where many seem content to
take a more relaxed approach.

Louis Prichard, president of Farmers National Bank of Danville, Ky., is
computer literate. He rose at 5 a.m. Hawaii time Monday to e-mail colleagues
and check the bank's latest financial picture via his laptop. Farmers has a

World Wide Web site with information about services and rates.

But home and online banking are still being studied by the four-branch, $190
million assets bank, and Prichard says that while Tapscott glossed over
computer security concerns, his customers worry about them.

He wants other banks to solve the start-up problems before he wades in. ''We're
like water skiers: We'll let someone else cut through the waves,'' he says.
''We'll ride along, not far behind.'' Far fewer than half the bank officials in
a huge ballroom at the Hilton Hawaiian Village here held their hands up when
Tapscott asked if they had tried the Internet. Some, like Harold R. Pehlke,
never use computers and are downright hostile to the idea.

Pehlke, 57, chief executive of Republic Bank of Chicago, sat through one of
many small-group sessions on new technology, then announced to the consultant
making the presentation: ''You have convinced me to retire in three years.''

''I wasn't sure I was going to do it, but after listening to you I am.''

Even featured speakers older ones, anyway shared similar views.

William Seidman, head of the Federal Deposit Insurance Corp. under presidents
Reagan and Ford, said he had listened to Tapscott's presentation, ''and my
immediate reaction was, 'Thank God I'm old.'''

On reflection, though, Seidman said he realized that most bank depositors were
probably in no particular rush for high-tech banking.

''Don't panic,'' he told the bankers. ''It'll take plenty of time before your
average customer gets there.''

That sounded good to Gib S. Nichols, a director of the Flathead Bank of
Bigfork, Mont.

''Our customers will let us know when it's time,'' he said.

Seidman, who ran the Resolution Trust Corp. when it began selling off the
wreckage of the 1980s savings and loan debacle, said the now flourishing bank
industry had better watch for risks as well as find new high-tech ways to
market services. Many banks ''are reaching for loans today,'' he said.

''When the going gets tough, the tough get out of the way and let someone else
do the dying,'' he said.

''We used to say as regulators, 'When the tide goes out you'll see who's
swimming without a bathing suit.' Those of you who feel the tide better look
down.''


News Release (NationsBank):Tuesday, October 8, 1996

NationsBank Official Partner of NCL's Internet Fraud Watch

NationsBank (NYSE: NB) is joining the National Consumers League's battle to
ensure the safety and security of online commerce. Through a $100,000 grant,
NationsBank is becoming the exclusive bank sponsor of NCL's Internet Fraud
Watch.

Internet Fraud Watch, launched in February by the League and operated from its
National Fraud Information Center, is a first-of-its-kind program for
monitoring, reporting and preventing fraud on the Internet. NCL shares Internet
Fraud Watch data with local, state, and federal agencies, including the Federal
Trade Commission and state attorneys general, as well as international law
enforcement groups.

"Internet Fraud Watch is a resource that consumers can use to get educated on
the Internet," said NCL President Linda F. Golodner. "Since our launch in
February, our Web site alone has received more than 300,000 visits from
consumers and averaged 25,000 hits a week. We have helped consumers as well as
law enforcement officials keep cyberfraud in check."

The NationsBank grant will significantly expand the Internet Fraud Watch
consumer education and protection programs, according to Golodner.

With plans to offer Web-banking in mid-1997 and more than 120,000 customers
already using its PC banking product, NationsBank ranks online security as a
top priority, according to NationsBank President Ken Lewis.

"NationsBank is happy to help NCL broaden its fraud education and prevention
efforts," said Lewis. "The Internet's growing popularity and potential for
commerce make it a vitally important avenue for American business. It's equally
important that consumers know the Internet is a safe and secure place to do
business."

The Federal Trade Commission rigorously monitors the Internet. The FTC recently
cracked down on a pyramid scheme it believed had bilked consumers of more than
$6 million. It also took action against several firms that marketed business
opportunities by using deceptive claims and false earnings reports.

"Consumers who suspect a scam on the Internet have critical information that
can be used by law enforcement agencies to track down and stop potential frauds
before more consumers are victimized," said Jodie Bernstein, director of the
FTC's Bureau of Consumer Protection. "The Internet Fraud Watch program gives
consumers an easy and cost-free way of providing this information, and it has
been a major help to the FTC in identifying particular scams in their infancy."

National Consumers League advisors field calls about alleged incidents of
online fraud, direct callers to local resources and report the information to
state and federal enforcement authorities. Enforcement agencies use the data to
help shut down cybercrimes and boiler rooms. Work-at-home schemes are among the
top-five scams currently operating online. (NCL Top Five Internet Scams will be
available on Wednesday, Oct. 9.)

Consumers can reach NCL's Internet Fraud Watch by phone through the National
Fraud Information Center at (800) 867-7060, or visit the home page at
http://www.fraud.org . They may also send e-mail messages to
nfic@internetmci.com.


Financial Times: Wednesday, October 9, 1996

Smartcard Trials Extended

The race to replace notes and coins with electronic cash hots up this month as
the Mondex consortium extends trials of its smartcards. The group, which
includes British Telecom, Midland Bank and NatWest Bank, is issuing students at
York and Exeter universities with the cards, which contain a microchip that can
be loaded with electronic money from automatic teller machines and home
telephones.

The cards are "swiped" through retailers' tills to deduct payment for
purchases. Users do not have to sign an authorisation slip as they do with
direct debit and credit cards. Electronic money saves banks and retailers the
considerable costs of handling physical cash. But so far consumers testing
Mondex smartcards in the UK have not received a share of this saving. Mondex is
well ahead of its main rival in the UK, VisaCash, whose backers include
Barclays and Lloyds Bank. It could be a year before VisaCash starts its own
trials; Mondex could be offering its cards to the public by then.
Jonathan Guthrie


AP Worldstream: Tuesday, October 8, 1996

Banker Sentenced to Death for Fraud

HANOI, Vietnam-- A Vietnamese private bank executive has been sentenced to
death after a court in southern Vietnam found him guilty of financial fraud and
stealing funds from accounts, state-run media reported Tuesday.

Nguyen Van Son, deputy general director of Gia Dinh Joint Stock Commercial
Bank, will face a firing squad for his crimes, said the Communist Party
newspaper Nhan Dan, or The People.

Ho Chi Minh City's People's Court convicted Son of fraud linked to the private
bank he and his wife, Thai Kim Lieng, established in 1992. The court said Son
stole about $4.5 million from the bank's accounts.

Unable to collect the necessary capital to qualify for a bank license, Son and
his wife forged several documents claiming they had about $800,000 worth of
funds from 17 shareholders, court records said.

When the State Bank of Vietnam granted the couple a banking license in 1992,
they began siphoning off money from newly opened savings and other accounts.

At the time, the bank had more than $6.5 million worth of accounts, the
newspaper said. The bank also had collected substantial gold reserves.

Son continued to forge credit documents over several years to increase the
bank's financial standing, the report said.

A police investigation in 1994 led to the arrests of Son, his wife and five
other bank associates.

Lieng and bank director Nguyen Le Tue also stood trial with Son. Both were
sentenced to life in prison.

Four other bank executives were sent to prison for terms ranging from 3 to 20
years. Although a number of banking scandals have been reported in Vietnam
since Hanoi began shifting toward a market economy. This latest case is the
largest of its kind and marks the first time a bank executive has been
sentenced to death for his crimes.

Nhan Dan described Son's crimes as ''organized acts that cause extremely
serious consequences and pose dangers to society.''

In addition to the death and prison sentences, the court ruled that the
culprits must repay money taken from the bank.

---

Dr.Dimitri Vulis KOTM
Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps