Fraud Prevention

Even before 911 - identity theft, stolen credit card numbers, and forged documents were emerging as major problems in e-commerce and in our society. In the post 911 environment, companies which offer services and/or products which help in preventing fraud, and authenticating identities are on the front lines. Some of the companies we are tracking in this area are engaged in the following businesses: biometrics (fingerprints, facial recognition, palm, retina, signature, voice), smart cards, digital identities, data mining, tamper proof documents, financial transaction processing, background checks, HIPAA Compliance, privacy protection, public key infrastructure, and security printing, such as: Activcard, Aladdin, Atmel, Carreker, Checkfree, Choicepoint, Cogent, Cybersource, Deluxe, Digimarc, Digital River, Fair Isaac, ID, Lasercard, Nuance, Verisign.

ActivCard (www.activcard.com) develops, markets and supports digital identity systems and products that enable its customers to issue, use and maintain digital identities in a secure, manageable and reliable manner. The Company's systems and products include software and hardware products that facilitate the authentication of a user to a network, system or application through a number of different personal security devices such as a smart card, token, biometric device, mobile phone or personal digital assistant. Its systems support a broad range of authentication methods, including passwords, public key infrastructure, remote network-access login, biometrics, multi-function smart cards and multi-function smart cards with picture identification that can also be used for physical access control. ActivCard markets its digital identity systems to government entities, financial institutions and other enterprises, including telecommunications, healthcare, networking technology and manufacturing companies.

Aladdin Knowledge Systems Ltd. is a global provider of security solutions that reduce software theft, authenticate network users and protect against unwanted Internet and e-mail content, including spam, viruses and spyware. Its security products are organized into two segments: Software Digital Rights Management (DRM) and Enterprise Security. Aladdin's Software DRM products allow software publishers to protect their intellectual property and increase revenues by reducing losses from software theft and piracy. Its Enterprise Security solutions enable organizations to secure their information technology assets by controlling who has access to their networks (authentication) and what content their users can utilize (content security). Additional information is available at www.Aladdin.com.

Atmel Corporation (www.atmel.com), designs, develops, manufactures and sells integrated circuit products. The Company develops and commercializes non-volatile memory that continues to store information after power is turned off. Atmel combines non-volatile memory with microcontrollers, digital signal processors and other logic to meet the needs of its customers. These complex system-on-a-chip solutions for various markets are manufactured using its multiple process technologies, including complementary metal oxide semiconductor (CMOS), double-diffused metal oxide semiconductor, logic, CMOS logic, bipolar, bipolar CMOS (BiCMOS), silicon germanium (SiGe), SiGe BiCMOS, analog, bipolar double-diffused CMOS and radiation-tolerant process technologies. Atmel develops these process technologies, manufacturing more than 94% of its products, which are used primarily in markets such as communications, consumer electronics and computing, storage, automotive, security and imaging.

Carreker Corporation’s (www.carreker.com) integrated consulting and software solutions are designed to increase clients' revenues and reduce their expenses, while improving security and increasing the value of their customer relationships. Carreker The Company provides products and services to more than 250 clients in the United States, Canada, the United Kingdom, Ireland, continental Europe, Australia, New Zealand, South Africa, South America, Mexico, and the Caribbean. Clients include the full range of community, regional and large banks, among them more than 75 of the largest 100 banks in the United States. Headquartered in Dallas, Texas since 1978, Carreker Corporation has offices in London and Sydney.

CheckFree (www.checkfreecorp.com), is a leading provider of financial electronic commerce services and products. Founded in 1981 and celebrating its 23rd year in e-commerce, CheckFree is comprised of three divisions: Electronic Commerce, Software, and Investment Services. CheckFree launched the first fully integrated electronic billing and payment solution in 1997. In the quarter ended March 31, 2004, more than 13 million consumers initiated online payments through services offered by CheckFree's Electronic Commerce division. Electronic billing and payment is available through more than a thousand financial services organizations, including banks, brokerage firms, Internet portals and personal financial management (PFM) software. At these sites, consumers are able to electronically receive and pay essentially all the bills most common to a U.S. household. CheckFree delivers 22.5 million e-bills each quarter. CheckFree Investment Services provides a broad range of investment management services to thousands of financial institutions nationwide. The division's clients manage nearly 1.5 million portfolios totaling more than $900 billion in assets. CheckFree's Software division provides solutions through three operating units: CheckFree ACH Solutions, CheckFree Financial and Compliance Solutions (CFACS), and CheckFree i-Solutions. CheckFree ACH Solutions provides software and services that are used to process more than two-thirds of the nation's nine billion Automated Clearing House payments, while CFACS provides reconciliation, financial messaging, workflow and compliance software and services to more than 600 organizations in the banking, brokerage, investment management, insurance and credit card industries, among others. CheckFree i-Solutions is the leading provider of e-billing and e-statement software and services for both business-to-consumer and business-to-business applications.

ChoicePoint (www.choicepoint.com) is a leading provider of identification and credential verification services for making smarter decisions in a world challenged by increased risks. Serving the needs of business, government, non-profit organizations and individuals, ChoicePoint works to create a safer and more secure society through the responsible use of information while ensuring the protection of personal privacy.

Cogent (www.cogentsystems.com) is a leading provider of Automated Fingerprint Identification Systems, or AFIS, and other fingerprint biometric solutions to governments, law enforcement agencies and other organizations worldwide. Cogent's AFIS solutions enable customers to capture fingerprint images electronically, encode fingerprints into searchable files and accurately compare a set of fingerprints to a database containing potentially millions of fingerprints in seconds.

CyberSource Corporation (www.cybersource.com) is a leading provider of electronic payment and risk management solutions. CyberSource solutions enable electronic payment processing for Web, call center/IVR, and POS environments and manage fraud risk associated with card-not-present transactions. CyberSource Professional Services designs, integrates, and optimizes enterprise-wide commerce transaction systems. Approximately 4,000 businesses use CyberSource solutions, including half of the Dow Jones Industrial companies. The Company is headquartered in Mountain View, California, and has sales and service offices in Japan, the United Kingdom, and other locations in the United States.

Deluxe Corporation (www.deluxe.com) provides personal and business checks, business forms, labels, personalized self-inking stamps, fraud prevention services and customer retention programs to banks, credit unions, financial services companies, consumers and small businesses. The Deluxe group of businesses reaches clients and customers through a number of distribution channels: the Internet, direct mail, the telephone and a nationwide sales force.

Digimarc Corporation (www.digimarc.com) is a leading supplier of secure media solutions used in a wide range of security, identification and digital media content applications. Digimarc provides products and services that enable the production of more than 60 million personal identification documents and driver licenses per year in 33 U.S. states and more than 20 countries. Digimarc's The Company's digital watermarking technology provides a persistent digital identity for various media content and is used to enhance the security of financial documents, identity documents and digital images, and support other media rights management applications. Digimarc has an extensive intellectual property portfolio, with 150 issued U.S. patents with nearly 3,100 claims, and more than 400 pending patent applications in digital watermarking, personal identification and related technologies. The company is headquartered in Tualatin, Oregon, with other U.S. offices in Burlington, Massachusetts; Fort Wayne, Indiana; San Francisco, California; and the Washington DC area; and European offices in London.

Digital River (www.digitalriver.com) is a provider of comprehensive electronic-commerce outsourcing solutions. As a global e-commerce outsource provider, the Company enables its clients to access its proprietary electronic-commerce system over the Internet. Digital River has developed a technology platform that allows the Company to provide a suite of electronic-commerce services, including Web commerce development and hosting, transaction processing, fraud screening, digital delivery, integration to physical fulfillment and customer service. Digital River also provides analytical marketing and merchandising services to assist clients in increasing Web page view traffic to, and sales through, their Web commerce systems. The Company provides an outsourcing solution that allows its clients to promote their own brands while leveraging its investment in infrastructure and technology.

Fair Isaac Corporation (www.fairisaac.com) is the preeminent provider of creative analytics that unlock value for people, businesses and industries. The company's predictive modeling, decision analysis, intelligence management, decision management systems and consulting services power billions of mission-critical customer decisions a year. Founded in 1956, Fair Isaac helps thousands of companies in over 60 countries acquire customers more efficiently, increase customer value, reduce fraud and credit losses, lower operating expenses and enter new markets more profitably. Most leading banks and credit card issuers rely on Fair Isaac solutions, as do insurers, retailers, telecommunications providers, healthcare organizations and government agencies. Through the www.myFICO.com Web site, consumers use the company's FICO® scores, the standard measure of credit risk, to manage their financial health.

L-1 Identity Solutions (www.L1ID.com, NYSE: ID - News), formed in 2006 from the merger of Viisage and Identix, offers a comprehensive set of products and solutions for protecting and securing personal identities and assets. Leveraging the industry's most advanced multi-modal biometric platform for finger, face and iris recognition, our solutions provide a circle of trust around all aspects of an identity and the credentials assigned to it -- including proofing, enrollment, issuance and usage. With the trust and confidence in individual identities provided by L-1 Identity Solutions, government entities, law enforcement and border management agencies, and commercial enterprises can better guard the public against global terrorism, crime and identity theft fostered by fraudulent identity. L-1 Identity Solutions is headquartered in Stamford, CT. For more information, visit www.L1ID.com.

LaserCard Corporation manufactures and markets LaserCard® optical memory cards, chip-ready Optical/Smart(TM) cards and other advanced-technology secure identification cards. The Company has sold over 28 million secure ID cards to meet the demanding requirements for border security, immigration and national identification in countries around the world, including the United States, Canada, and Italy. In addition, the Company manufactures optical card read/write drives and develops optical card system software, card-related ID subsystems and peripherals. The Company, headquartered in Mountain View, Calif., operates two wholly owned German subsidiaries: Challenge Card Design Plastikkarten GmbH, which manufactures advanced-technology cards; and cards & more GmbH, which markets cards, system solutions, and card personalization printers. Additional information is available at www.lasercard.com.

Nuance Communications (www.nuance.com) is a leading provider of speech and imaging solutions for business and consumers around the world. Its technologies, applications, and services make the user experience more compelling by transforming the way people interact with information and how they create, share, and use documents. Every day, millions of users and thousands of businesses experience Nuance's proven applications. For more information, please visit www.nuance.com.

VeriSign (www.verisign.com) is a provider of critical infrastructure services. The Company is organized into two service-based lines of business: the Internet Services Group and the Communications Services Group. The Internet Services Group consists of the Security Services business and the Naming and Directory Services business. The Security Services business provides products and services that enable enterprises and organizations to establish and deliver secure Internet-based services to customers and business partners, and the Naming and Directory Services business acts as the exclusive registry of domain names in the .com and .net generic top-level domains and certain country code top-level domains. The Communications Services Group provides Signaling System 7 network services, intelligent database and directory services, application services, and billing and payment services to wireline and wireless telecommunications carriers.

All of these companies are included in our Investment Guide To 350+ Security Stocks ©.