Visa U.S.A. is giving CardSystems Solutions a little more time to get its act together. On Thursday, Visa announced that it has delayed plans to sever ties with the Atlanta payment processor by three months, in order to facilitate a planned sale of CardSystems to electronic payment vendor CyberSource Corp.
CardSystems processes credit card transactions totalling about $18 billion per year for approximately 120,000 merchants. Both Visa and American Express Co. had planned to cut ties with the Atlanta company at the end of October, after a CardSystems security breach exposed some 40 million credit card numbers to online thieves. CardSystems Chief Executive Officer John Perry later admitted that some of the stolen records had been improperly stored by his company.
Visa said it will now wait until Jan. 31, 2006, before requiring merchants to move to another credit card processor. "Visa is granting an extension... for the sole purpose of helping facilitate CyberSource's planned acquisition of (CardSystems) assets," the company said in a statement.
Last week, CyberSource signed a letter of intent to acquire CardSystems, but the company hinted that the acquisition would be contingent on Visa and American Express's continued business.
Now it appears that if the CyberSource acquisition goes through as planned, companies such as Visa and American Express may stay with the CardSystems network, provided that CyberSource can assure partners that the data will be secured.
"If this transaction moves forward, it is a win-win situation for all those associated with the deal, because those financial institutions who already use CardSystems will be able to transition more easily to CyberSource," said a source familiar with the negotiations, who asked not to be identified because of the sensitive nature of the deal. "There are less headaches there," the source said.
The CyberSource acquisition is expected to be completed by year's end.
As of Thursday, American Express had no plans to change the October cut-off date, but the CyberSource acquisition does change things, said Judy Tenzer, an American Express spokeswoman. "We had previously discussed terminating our relationship at the end of October, but in light of the new circumstances we are evaluating how to more forward," she said.
REFERENCES:
Troubled CardSystems to be sold, Sep. 23, 2005
This whitepaper explains the terminology and concepts behind Data Replication technologies and establishes some sizing rules through worked examples. Learn the new paradigm in disaster tolerance—protect data anywhere.
Download now »
Server virtualization is a popular option for dealing with mounting datacenter costs. Another equally promising approach is the use of an Application Delivery Controller. Citrix NetScaler provides a low-cost way for organizations to reduce their server count and accrue cost savings from a reduction in space, cooling, power and personnel.
Download now »
The emergence of WLANs has created a new breed of security threats to enterprise networks.
Included in HP ProCurve WLAN solutions is security technology that alleviates threats from WLANs through:
* Monitoring wireless activity inside and out of the enterprise
* Classifying WLAN transmissions into harmful and harmless
* Preventing transmissions that pose a security threat to the enterprise network
* Locating participating devices for physical remediation
Effectively address data protection challenges, implementing solutions that help store and protect business–critical data while cutting costs and improving efficiency and reliability.
Download now »
Sign up to receive Security Resource Alerts
This white paper provides guidance on how to develop a strategic approach to managing and monitoring logs, a key function required for compliance with many regulatory mandates and a critical defense against security threats.
Download now! »
Learn about the processes and technologies that support security information management (SIM) operations, as well as the business case for SIM. The series examines different options for implementing SIM and gives you evaluation criteria for selecting the best option for your organization.
Download now! »
Learn the strategies, actions, and capabilities that Best-in-Class organizations employ and technologies they choose to obtain superior performance against various security performance metrics. This report provides guidelines for identifying which security solutions to consume as a MSS and defines best practices for choosing and managing MSSPs.
Download now! »
Recommend This
