Fraud Update

   BioPay, LLC recently launched its bCheck biometric payment service, which gives consumers the convenience of paying for purchases by the touch of a finger. Cash, checks, credit and debit cards, and ID are not required.
   Merchants can take advantage of bCheck to substantially reduce processing costs, payment handling, and losses due to fraudulent transactions. One of the first bCheck implementations will be done by Baltimore-based Santoni's Supermarket.
   "Biometric payments are a natural evolution for retailers," said Tim Robinson, President, BioPay, LLC. "Consumers and merchants, alike, are seeing the substantial value biometrics offer. Advanced applications make it inevitable that financial transactions will be initiated with a biometric."
   According to a recent survey by the Opinion Research Corporation for the National Consortium for Justice Information and Statistics, 85 percent of respondents consider it acceptable to use biometrics to make transactions more secure.
   Biometrics are unique to an individual and can't be stolen or easily replicated, so they offer consumers protection against identity theft. Merchants accepting biometric payments can be confident the customer is who they say they are, helping to reduce losses to fraud.
   Convenience is another benefit of biometric payments. Consumers no longer need to carry cash, a checkbook, credit or debit cards or ID to make purchases. Using a biometric, consumers can quickly pay for purchases and be on their way. Merchants accepting biometric payments speed the checkout line, helping to serve all customers efficiently.
   Santoni's Supermarket, a family-owned business with a customer count of more than 1.2 million in 2002, will offer bCheck to its grocery customers in the first part of the year.
   "Paper checks are less expensive to process than credit and debit card transactions, yet they are not as secure and take longer to process," says Rob Santoni, the store's Chief Financial Officer. "With bCheck, payment and processing is electronic so the transaction is done quickly but securely. As a result, we get our money quicker and at a lower processing cost."
   Biometrically-initiated ACH transactions are less expensive to process than paper checks, credit or debit card payments. For example, bCheck transaction costs are 75 percent less than the costs of credit card and off-line debit transactions.
   bCheck is based on biometric technology used in Paycheck Secure, BioPay's payroll check cashing system. During a short enrollment process, the customer gives the clerk his or her driver's license or other ID for inputting into BioPay's database. At the same time, the customer's index fingers are scanned. The customer's preferred checking account is also recorded. The entire process takes less than two minutes and all the information is securely stored in the BioPay system. Repeat customers can quickly and conveniently pay for purchases with the touch of a finger; cash, checks, credit and debit cards, and ID are not required.
   To make a purchase, the bCheck customers simply enter their phone number and place their finger on the scanning device and confirm their purchase amount. Funds are securely transferred from the enrolled account to the merchant. The transaction is performed like a normal check payment, but settlement is performed electronically and the customer's finger acts as the signature on the check.