CKFR Checkfree Corp (MM)

-- CheckFree FraudNet(SM) Helps Prevent Fraud Before It Happens; Participating Banks Mutually Benefit From CheckFree FraudNet Alliance -- ATLANTA, Nov. 8 /PRNewswire-FirstCall/ -- CheckFree Corporation (NASDAQ:CKFR) today announced the launch of CheckFree FraudNet(SM), the Company's newest solution to continue making electronic billing and payment safer than offline, paper-based bills and payments. The new, automated system, supported by Actimize Inc.'s analytics technology, helps mitigate risk and reduce fraud for banks and consumers before it happens, which makes paying bills online even safer for consumers and fighting crime more efficient for financial institutions. Over the years, CheckFree has established a cooperative network of security, privacy and law enforcement contacts across more than 1,700 consumer provider clients, billing organizations and merchants across various jurisdictions. CheckFree FraudNet is an automated fraud detection and case management system that is designed to be a collaborative solution. The service combines CheckFree's cumulative knowledge of payment patterns and a sophisticated analytics engine to help financial services clients detect and stop unauthorized payments before they are completed. CheckFree FraudNet is powered in part by a sophisticated analytics engine from Actimize, the leading provider of enterprise technology solutions for mitigating operational risk, using real-time analytics. CheckFree FraudNet is proving very effective at the detection of possible fraudulent transactions through the automation of fraud prevention, detection and case resolution processes that have been conducted successfully for many years by CheckFree Fraud Control Services. Not only does CheckFree FraudNet have the potential to significantly reduce losses for participating banks, but the data on attempted fraudulent transactions can provide forensics to law enforcement to help catch and prosecute fraudsters. Fraud rates for CheckFree's electronic billing and payment have historically been extremely low due to stringent policies and practices already in place. Now, as the continued adoption of electronic billing and payment increases volumes, these processes will be more fully automated, monitored and able to stop fraudulent transactions before they occur. "CheckFree is committed to continuing to make online billing and payment safer than offline. Our commitment to quality includes bringing our consumer service providers, billers and their customers the highest possible levels of security and privacy protection," said Matt Lewis, executive vice president and general manager of CheckFree's Electronic Commerce Division. "CheckFree FraudNet is one more reason why receiving and paying bills online is safer and more secure than receiving paper bills and mailing signed paper checks -- because CheckFree and its financial services clients will be proactively detecting and preventing fraud." How it Works As the leading provider of electronic billing and payment services to more than 1,700 consumer service providers, CheckFree is in a unique position to help its customers fight fraud. The CheckFree FraudNet system adds the ability to detect rules-based anomalies and place payment transactions into queues for further examination by fraud prevention teams at either CheckFree or its financial institution clients. The Actimize analytics engine issues alerts when suspicious transactions or fraud patterns are detected. A "Yellow Alert" transaction enters a queue as it alerts fraud prevention teams to examine the payment that is ready to be processed. The "Red Alert" signals a high likelihood of fraud and holds the payment for review by a Fraud Specialist. If the payment is cleared as valid, the transaction is processed with a negligible delay. This new automation is designed to take the level of quality of previous processes to the next level of detection and prevention as consumer adoption continues and monthly payment volumes are anticipated to increase. As the CheckFree FraudNet engine gathers increasing amounts of data from the millions of transactions CheckFree processes daily, the intelligent system continues to learn and continually gets "smarter." These ongoing improvements will deliver shared benefits to all CheckFree customers who utilize the service. CheckFree FraudNet monitors every bill payment transaction that appears on consumers' accounts at member banks and matches them against pre-established rules developed through experience. Consumers who pay bills online will not notice the review process or longer payment times unless a transaction is determined to be potentially fraudulent. The alert system allows the fraud teams at a bank or at CheckFree to investigate and resolve Red and Yellow Alerts quickly and more effectively manage their time and case loads. "By moving the fraud prevention and detection system to an automated process, we're finding constant improvement in the rates of detection," Lewis continued. "As we move forward, the CheckFree FraudNet system will continue to learn from a high volume of growing transaction data to deliver shared benefits to all participants. The rule sets will become increasingly advanced and when leveraged in conjunction with our wealth of transaction data, will allow us to prevent more fraudulent transactions while reducing the number of false fraud alert cases that are worked by security teams." CheckFree FraudNet Alliance Every financial institution that leverages CheckFree FraudNet technology becomes part of an alliance that leverages a wealth of experiential history. Each member also has the ability to manually enter information to continually enhance the effectiveness of the tool, reduce cross-industry response times and potentially fight crime as an industry. CheckFree FraudNet accumulates a growing knowledge base of patterns and individual fraudsters for continual refinement to rules sets and analytics. This collaborative environment is designed to allow financial institutions to build on the effectiveness of best practices in fraud prevention and detection. These benefits are quickly realized by financial institutions through a turn-key implementation that eliminates development costs and provides a live system within days. Online Billing and Payment Safer than Paper Armed with CheckFree FraudNet, CheckFree and its member banks, brokerage firms, credit unions and portals anticipate additional reductions in fraud rates, and can assure their consumers that they are paying bills online from among the safest sites on the Internet. In addition to stringent security technologies and privacy policies in place, consumers may not be aware that financial services sites and electronic transactions in particular are subject to regulations that protect consumers that other types of sites are not. These include Federal Reserve Regulation E, the Uniform Commercial Code and The Internet False Identification Act of 2000. According to a study released in January 2005 by Javelin Strategy & Research, identity theft and identity fraud are more frequently committed using traditional methods -- a lost or stolen wallet, access of account information from paper mail and trash -- and are more frequently perpetrated by people the victims know than by strangers who hack Internet sites. The best ways consumers can protect themselves are illustrated by a quiz and tips at a site hosted by the Better Business Bureau -- http://www.idsafety.net/. Javelin Strategy & Research estimates that identify fraud crimes total $52.6 billion annually. "Using technology to prevent and detect identity fraud represents an opportunity for financial institutions to differentiate themselves on improved customer safety and overall profitability," said James Van Dyke, founder of Javelin Strategy & Research. "Fraudsters access information through all channels, and may try to leverage electronic transactions to commit crimes. As an automated system that combines early detection with prevention of fraudulent transactions, CheckFree's solution has the potential to further deliver on the inherent potential safety advantages of electronic payments." According to an October 2005 Gartner report, about 65 percent of all U.S. banks will use transaction anomaly detection and user profiling systems by the end of 2010.(i) "Gartner has been recommending that financial services leverage technology to protect consumers. Customer and transaction authentication and monitoring requires that a financial institution has a front- and back-end strategy. Instead of just authenticating a customer, we have been saying that banks must monitor back-end activity at the account and transaction level to help prevent fraud and inspire greater consumer confidence," said Avivah Litan, research vice president at Gartner, Inc. Consumers who pay bills from CheckFree-powered sites are further protected by the CheckFree Guarantee, which minimizes consumer liability for fraud associated with online bill payment transactions. About Actimize (http://www.actimize.com/) The Actimize Identity Theft Solution is capable of identifying suspicious activity in real time, monitoring all on-line activities, including user sessions, IP addresses, bill payment, internal transfer, ACH and account services. Actimize's enterprise solutions provide top financial institutions with the knowledge they need in real time. Recognized by leading industry analysts, Actimize offers solutions for Operational Risk Management including Anti-Money-Laundering, Fraud Prevention, Brokerage and Banking Compliance, and Brokerage Surveillance. Actimize's innovative platform speeds implementation and is sensible for the bottom line. With over 40 enterprise clients, including seven of the ten largest financial organizations, Actimize provides surveillance and compliance monitoring for over USD $4 trillion in assets. The Actimize customer base includes banks, brokerages, insurance firms, regulatory bodies, and government agencies. About CheckFree (http://www.checkfreecorp.com/) Founded in 1981, CheckFree Corporation (NASDAQ:CKFR) provides financial electronic commerce services and products to organizations around the world. CheckFree Electronic Commerce solutions enable thousands of financial services providers and billers to offer their customers the convenience of receiving and paying their household bills online or in person through retail outlets. CheckFree Investment Services provides a broad range of investment management solutions and outsourced services to thousands of financial services organizations, which manage more than $1.2 trillion in assets. CheckFree Software develops, markets and supports software applications that are used by financial institutions to process more than two thirds of the 12 billion Automated Clearing House transactions in the United States. The division also provides operational risk management, financial messaging, corporate actions, and regulatory compliance software to more than 1,500 organizations across the globe. Certain of CheckFree's statements in this press release are not purely historical, and as such are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding management's intentions, plans, beliefs, expectations or projections of the future. Forward-looking statements involve risks and uncertainties, including without limitation, the various risks inherent in CheckFree's business, and other risks and uncertainties detailed from time to time in CheckFree's periodic reports filed with the Securities and Exchange Commission, including CheckFree's Annual Report on Form 10-K for the year ended June 30, 2005 (filed September 2, 2005). One or more of these factors have affected, and could in the future affect CheckFree's business and financial results in future periods, and could cause actual results to differ materially from plans and projections. There can be no assurance that the forward-looking statements made in this press release will prove to be accurate, and issuance of such forward-looking statements should not be regarded as a representation by CheckFree, or any other person, that the objectives and plans of CheckFree will be achieved. All forward-looking statements made in this press release are based on information presently available to management, and CheckFree assumes no obligation to update any forward-looking statements. (i) Gartner Research "Regulators Tell U.S. Banks to Adopt Stronger Risk- Based Authentication" by Avivah Litan. October 27, 2005. DATASOURCE: CheckFree Corporation CONTACT: Media, Judy DeRango Wicks, +1-678-375-1595, or , or Investors, Tina Moore, +1-678-375-1278, or , both of CheckFree Corporation Web site: http://www.idsafety.net/ http://www.actimize.com/ http://www.checkfreecorp.com/

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