Sunday, December 27, 2009

BofA Settles Security Breach...Liable for up to $850 Million


A U.S. District Court judge in Kentucky on Wednesday gave preliminary approval to a settlement between Countrywide Financial Corp. and millions of customers whose financial data was exposed in a security breach, the Associated Press reports Thursday. The settlement calls for Countrywide, now owned by Bank of America Corp. (BAC), to give as many as 17 million victims of the breach free credit monitoring--includng anyone who obtained a mortgage and anyone who used Countrywide to service a mortgage before July 1, 2008. A consumer would be allowed up to $50,000 in reimbursements from Countrywide for each instance of identity theft. A "fairness hearing" in the case is scheduled for July in Louisville, Ky. 

A Bank of America spokeswoman said the settlement is "in the bank's best interest" to avoid additional legal expenses.

17,000,000 x $50,000 = $850 Million Dollars

First Data Buys ICICI

By Shrija Agrawal (

First Data Corporation, currently owned by PE giant KKR, has bought an 81% stake in ICICI Merchant Services.    ICICI Bank has concluded the sale of its network of electronic point of sales (PoS) terminals that accept credit and debit card payments to First Data Corporation (FDC), reports The Economic Times.

FDC is currently owned by private equity giant KKR. The bank has hived off its network of over 1.5 lakh electronic swipe machines to a separate company — ICICI Merchant Services.

The report adds that First Data has bought an 81% stake in the company which has been valued at a little over $90 million.   ICICI Bank expects that the specialised company will bring down transactions costs and also grow the payment network more efficiently. This is the first time that an Indian bank has hived off its PoS terminal network.  Other large banks might also follow the move of ICICI Bank. The bank was also reportedly looking to spin off its ATM assets earlier, but decided to hive off only PoS.

Some other banks like SBI have outsourced ATMs from Tata Communications and TCS, while Bank of India, United Bank and Dena Bank have outsourcing deals with Fidelity National Information Service.  Yes Bank tied up with the American payment processing company First Data Corporation (FDC) for an ATM deal, where the bank will pay transaction-based charges.


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