Registers – Systems controlled by data bearing records – Banking systems
Reexamination Certificate
2002-02-01
2004-08-31
Lee, Michael G. (Department: 2876)
Registers
Systems controlled by data bearing records
Banking systems
C235S380000, C235S382000, C235S375000, C705S039000, C705S044000, C705S045000
Reexamination Certificate
active
06783062
ABSTRACT:
BACKGROUND OF THE INVENTION
1. Field of the Invention
THIS INVENTION relates to a system for inhibiting fraud in relation to the use of negotiable instruments.
2. Description of the Related Art
Within this specification by a negotiable instrument is meant a cheque, a credit card, a debit card, a bond, a share certificate, an account card, a traveller's cheque, an electronic transfer, and any other instrument that has inherent value to the owner thereof and in relation to which the owner can suffer a financial loss as a result of unauthorized and/or fraudulent dealing therewith by third parties.
Fraud in relation to the use of negotiable instruments is an international problem. Many different forms of fraud that can result in the owner of a negotiable instrument suffering a financial loss are known, with the common element generally being that the negotiable instrument is presented for serving as a payment for goods purchased, for converting its value into cash, or for depositing its value into a third party account, without authorization of the original owner or in a form in which it has been fraudulently tampered wit to the detriment of the original owner.
Although the invention as defined and described hereafter is directed mainly at inhibiting fraud in relation to the use of cheques and credit cards, it must be understood that the invention applies also to inhibiting of fraud in relation to the use of any other negotiable instrument and the features of the invention must be interpreted as such.
For the sake of convenience and clarity, the original owner of a negotiable instrument as herein envisaged shall merely be referred to as the owner of the negotiable instrument who, in relation to certain negotiable instruments such as cheques, promissory notes, and the like, will be the person issuing such instruments, and in relation to other negotiable instruments such as credit cards, will be the person who legally presents such instruments in order to serve their intended purpose. The owner is thus generally the person, whether a natural or a juristic person, who can suffer a loss as a result of the unauthorized or fraudulent use of the negotiable instrument of which he is the owner.
The person or body to whom a negotiable instrument is presented shall hereinafter be referred to as the presentee who, for example, in relation to cheques, and the like, generally will be a bank and particularly an employee of a bank, and in relation to credit cards, generally will be a vendor who accepts the use of a credit card as payment for goods purchased or for services rendered. The presentee also is the party who, in accordance with the present invention, is generally responsible for ensuring that the owner of the negotiable instrument is not prejudiced.
The person presenting a negotiable instrument to the presentee shall hereinafter merely be referred to as the presentor and, in practice, this may be a legitimate person to whom the instrument has been issued or who owns the instrument, or an illegitimate person who may be attempting a fraudulent act and/or who is not authorized to present the instrument.
It will be appreciated that the various negotiable instruments as herein envisaged can be associated with various different ‘types’ of presenters and presentees. Presentees need not necessarily be banks or vendors, but may be any third party who generally deals with and/or who is responsible for dealing with, such instruments.
The application of the system for inhibiting fraud in relation to the use of negotiable instruments is associated with a suitably programmed central communication and processing unit that can be communicated with via a direct telephone line, via the internet, or the like. This unit shall herein be referred to as a central communication and processing unit and any reference to this unit must be interpreted as a reference to a suitably programmed unit that includes means for communicating with the unit, as well as data processing means and data storage means that permit processing of stored data and of data communicated to it, for enabling the system of the invention as defined hereafter.
BRIEF SUMMARY OF THE INVENTION
According to the invention there is provided a system for inhibiting fraud in relation to the use of negotiable instruments, which includes the steps of:
the owners of negotiable instruments communicating with a central communication and processing unit in order to register with the unit by providing information, including at least identification numbers, linked directly with the respective owners and information linked directly with the negotiable instruments in respect of which fraud is to be inhibited, each owner then being provided with an individual secret code by the unit; and
the presentees of negotiable instruments communicating with the central communication and processing unit in order to register with the unit by providing information, including at least identification numbers, linked directly with the respective presentees, each presentee then being provided with an individual secret code by the unit, and which includes, in relation to each negotiable instrument to be issued or used by a registered owner, the steps of:
the registered owner communicating with the central communication and processing unit in order to authorize the negotiable instrument, by identification via the identification number and the individual secret code linked with the owner and by providing sufficient details in respect of the negotiable instrument for subsequently permitting the instrument to be verified, the unit then issuing an authorization code to be linked with the instrument; and
upon presentation of the authorized negotiable instrument by a presentor to a presentee, the presentee communicating with the central communication and processing unit in order to verify the negotiable instrument, by identification via the individual secret code linked with the presentee and providing the authorization code linked with the instrument, the unit in response communicating to the presentee the details for verifying the instrument provided by the owner of the instrument and thereby permitting the presentee to verify the instrument as the instrument authorized by the owner.
The system of the invention particularly may provide for the central communication and processing unit to permit communication via a direct telephone line and, as such, includes an audiotext electronic processing system that permits verbal information to be converted into binary code, and a processing and memory system linked to the audiotext electronic processing system for processing information received by the audiotext electronic processing system and thereby carrying out the functions of the unit. Alternatively, or in addition, the central communication and processing unit may permit communication via the internet and, as such, may include a processing and memory system for receiving and processing information received via the internet and thereby carrying out the functions of the unit.
Presentees registering with the unit also will provide the unit with any other information, including at least their names, that will subsequently permit the unit to identify a particular presentee that dealt with the verification of a particular negotiable instrument.
Owners registering with the unit, insofar as the owners are natural persons, may provide at least their names and their official identity numbers. Insofar as owners are juristic persons such a registered businesses, upon registering with the unit they will provide at least their names and their official registration numbers.
The system of the invention may provide for owners registering with the unit, insofar as they wish to use the system for inhibiting fraud in respect of negotiable instruments such as cheques rendered payable via their bank accounts, to provide the unit with the name of each relevant bank, the branch code associated with the said relevant bank and the relevant bank account number.
Insofar as owners registering with the unit wi
Brinks Hofer Gilson & Lione
Clay-Smith Craig M.
Le Uyen-Chau N.
Lee Michael G.
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