The unannounced Pantech P9020 appeared on the FCC web site today. This small touch-screen phone sports a slide-out QWERTY keyboard and HSDPA 3G data suitable for AT&T's network. Other features appear to include Bluetooth, GPS navigation, memory card slot, and music player. The draft user manual mentioned numerous AT&T services, such as AT&T Navigator, AT&T Radio, YPmobile, and AppCenter, indicating the phone is planned for release by AT&T.

By Melanie Dixon

Canadians love cashing in credit card rewards, according to a piece on TheStar.com, but do they know who really funds them?

It can be tempting to use your card for virtually every purchase in return for rewards. Save up your points and, at the end of the year, there could be enough to cash in for a valuable gift. Who could say no to a free family vacation worth thousands? In addition to free trips, rewards credit cards can offer free groceries and other products and services.

To the average consumer, gifts from rewards credit cards appear free, but when it comes down to it, they really aren't.

The people who really pay are the retailers through increased credit card fees, though there are few benefits to do so. In one scenario, a small business could end up paying more than $10,000 a month in added fees.

Rewards programs are funded through merchant interchange fees initially paid by the retailer, but the cost is passed down into the price of the goods that you buy. Consumers don't seem troubled by the fact that they may be paying more for the goods and services they purchase, as long as they get something free out of it.

Everywhere we turn, we are being offered a rewards credit card for this, a rewards credit card for that. Soon our wallets are bursting with rewards credit cards, with little thought that without them, we may have had cheaper prices at the supermarket.

According to Colloquy, a market research arm of LoyaltyOne, which owns the Air Miles program, Canadians are mad for rewards programs. There are 114 million active members of rewards credit cards programs in Canada. That adds up to four rewards credit cards for every single person.

Retailers feel they need to accept all types of credit cards or risk losing the business to someone else, despite the higher costs associated with accepting rewards credit cards.

Meanwhile, the Consumers Association of Canada opposes any action that would reduce the value of rewards programs, either through a cap on interest or fees.

Costs are passed down to consumers in the form of increased pricing, but for now, Canadian consumers remain oblivious to the impact rewards credit card programs have on the prices of the goods and products they purchase, as long as they can get a free gift in the process.

By Cara Henis

Shoppers are swiping their credit and debit cards more frequently and spending more voraciously this holiday season compared to the last, signifying a boost in consumer confidence, according to Moneris, a payment processing firm.

Analysis of credit and debit card usage indicates that total retail spending rose by about 5 per cent during the first weekend of December compared to the same weekend last year. Sales at department stores shot up by almost 13 per cent from last year while spending at clothing and drug stores increased by about 5 per cent and 4 per cent, respectively.

Shoppers continued to swipe, increasing expenditures by about 6 per cent during the second weekend in December contrasted to holiday season 2008. Consumers spent most on clothing, raising apparel purchases by more than 11 per cent this year versus last.

"As the Canadian economy begins a trend toward recovery, the increase in pre-holiday spending is a clear indication of renewed consumer confidence," said David Ades, Moneris Solutions senior vice president of sales and marketing, in a press release. "Canadians are clearly more optimistic about the future this year than they were during this time last year, and retailers are capitalizing on this by using creative marketing tactics to draw them in early and often."

Spending habits were calculated by considering both the number of credit and debit card transactions in addition to the total amount spent.

By Cara Henis

Return fraud, dubbed "the biggest crime you never heard of," is the most common caper pulled against retailers, accounting for more instances of fraud than credit card and counterfeit cash schemes combined, according to a report released by Statistics Canada.

Return fraud involves bringing stolen merchandise back to a store under the guise that it was purchased to obtain a refund or store credit. The government's survey of retailers indicates these scams make up 33 per cent of all fraudulent activities while more well-known schemes like credit card and counterfeit money scams each only account for 15 per cent of all crimes.

In addition to collecting money by returning stolen goods, fraudsters also bank by bringing back goods purchased with counterfeit money or by using bogus receipts to return used items.

"These types of crimes are more often than not perpetrated by organized crime groups who are also active in other criminal activities," said Mark Beazley, a spokesman for the Retail Council of Canada, to Canwest News Service. "Of course there are some opportunists out there, but for the most part, fraud scams involve sophisticated networks of career criminals."

According to a Retail Council of Canada survey, 72 per cent of retailers fell victim to a return fraud scam during the past year. Criminals often target stores with lax return policies, which has spurred retailers to begin beefing up return requirements. Some stores are only accepting returns with proof of purchase or restricting return authorization to senior staff members.

"It's important to keep in mind that retailers have to strike a fine balance between good customer service and fraud prevention when drafting their return policies," Beazley told Canwest News Service. "They don't want to cause frustration for customers with legitimate returns."

Return fraud isn't unique to Canada. The National Retail Federation in United States predicts a $9.6 billion loss this year alone because of return scams, hence earning return fraud the title in several U.S. news reports as the "the biggest crime you've never heard of."

By Melanie Dixon

New findings show that the new chip credit card migration in Canada increases security and fraud detection, thus preventing charge backs. The new chip cards have already proved their success in preventing fraudulent transactions at the till.

The cards were created to address increasing merchant concerns over fraud and charge backs. Traditionally, credit card fraud has been a lucrative enterprise by criminals. The chip cards will address the $250 million that was lost to fraudulent activities in 2006, with growth at an alarming rate of 25 per cent annually.

Moneris Solutions revealed that merchants who accept the new chip credit cards are experiencing a lower-than-average rate of fraud. Moneris Solutions is Canada's largest credit card payment processor. "This is the first data of its kind from Canada and demonstrates that chip cards reduce fraud and charge backs," says Moneris

Capturing the fraudulent activity before it starts means fewer charge backs for merchants, and fewer worries for customers who have had lost or stolen cards.

The new cards have a microchip embedded in the card that stores the cardholder's account number. The cards and the chip terminals work together to ensure a secure transaction. The cardholder confirms the transaction with a personal identificaiton number (PIN) number at the terminal. Counterfeiting is stopped in its tracks, as without the PIN number, the card will be denied.

Figures reveal that those merchants who processed more than 40 per cent of their total daily transactions using the new chip technology have up to four times fewer charge backs than those who processed less than 40 per cent of total transactions using the older version.

Retailers said that they had 2.9 per cent fewer charge backs overall, while restaurants had 1.8 times fewer charge backs. Gas stations were not included in the findings, as they normally have fewer instances of fraud.

Sango Ligotti, director of marketing and communications at Moneris Solutions, addressed concerns by saying in an article in eCommerce Journal, "Not only does the data illustrate the importance of chip cards to merchants but it shows their tremendous value to everyone along the payment value chain, including cardholders."

Nearly one-third of all transactions processed overall are currently using the new chip cards. Ligotti stressed that the findings show that it was well worth the effort.

Moneris examined the data of 21,000 merchants. Of those merchants, 40 per cent to 95 per cent had processed transactions with the new chip technology during the September 2009 period.

The new chip cards arrive just in time for the holiday shopping season. Canadian merchants are eagerly anticipating the arrival of consumers with their new chip cards in hand.

By Cara Henis

Some of Canada's largest banks cut the amount of money kept aside to cover credit card defaults, signaling optimism that the credit crisis is over.

According to fourth quarter 2009 figures, The Canadian Imperial Bank of Commerce and the Toronto-Dominion Bank all lowered their provisions for credit card-related losses. These provisions are kept on hand to cover lapses in consumer payments on credit card accounts.

CIBC, one of the largest credit extenders in the country, set aside $224 million, down from $248 million last quarter.

"If [CIBC] is right and the economy's going to recover imminently, that's great, but if 2010 turns out to be worse than expected, they will be impacted significantly," said Brad Smith, an analyst at Blackmont Capital, told the National Post.

Toronto-Dominion Bank also showed confidence that defaults would decrease, slashing its credit card loss provisions, according to the National Post.

"The whole credit thing is a concern for me because there is nothing to support the levels of provisioning the banks are doing," Smith told the National Post. He said economic forecasting may be inaccurate due to unusual market events that have occurred in the past two years.

"You can't look to the past to support the adequacy of the provisioning," he said.

Yet not all banks are placing as much confidence in consumers' abilities to pay. The Royal Bank of Canada, the largest bank in the country, set aside $108 million to cover potential credit card losses, up from $107 last quarter.