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 PROVIDENCE, R.I., Sept. 10 /PRNewswire/ -- NESTOR, Inc. (OTC: NEST), today announced that three major companies have agreed to institute pilot projects as the first step toward installation of the company's credit card Fraud Detection System (FDS)(TM). Contracts were signed with the San Francisco-based Bank of America, and Toronto-based Canadian Imperial Bank of Commerce. Agreement was also concluded with Europay International, SA, a global partner of Mastercard International. Europay, headquartered in Belgium, provides its 700 member banks and processors with a full range of payment services, including check guarantee, ATM, electronic point-of-sale, credit and charge services. FDS systems are now installed and operating at Mellon Bank in Pittsburgh, and at Sligos, SA, a major European financial services firm headquartered in France.
 The FDS software, a mainframe-based application designed to detect fraud in the credit card industry, was developed by NESTOR and is used to protect individual cardholders and banks against losses due to fraud, making use of the company's proprietary neural network architecture to "learn" a cardholder's pattern of credit card use. FDS is capable of detecting changes in these patterns that might indicate fraud. The system catches changes as they begin to occur, providing the bank with the earliest possible warning of potentially fraudulent activity. The inherent adaptability of FDS allows the software to learn new patterns as suspected fraud begins to occur.
 Dr. Douglas L Reilly, vice president/financial operations for NESTOR, added: "In the last several years, credit card fraud has seen record growth. U.S. banks lost over $500 million to this type of fraud in 1991. Losses for 1992 rose 60 percent to over $800 million. In this climate, banks are seeking ways to make their fraud management efforts more productive, more effective, and less costly. FDS is unique in achieving earlier, more accurate fraud detection. This combines to significantly reduce both fraud loss and the associated administrative costs.
 "With the signing of these two major North American banks, and the pivotal potential in Europe with Europay, we are proving that our proprietary fraud detection system is indeed becoming the worldwide performance leader against which all others will be judged."
 Dr. David Fox, president and chief executive officer of NESTOR, commented: "We have been very busy over the past few months on three fronts. One, the FDS agreements foreshadow a steady stream of royalty income in fraud detection and financial risk modeling. Two, our NestorReader revenues continue to grow as more and more vendors incorporate our superior character-recognition technology into their new products and installations. Finally, we have completed a new phase of private financing to provide working capital."
 All NESTOR products are based on the company's proprietary neural- network technology which operates as adaptive information-processing systems that "learn" from experience. All products can be taught to recognize complex configurations of data, and to interpret input patterns.
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 /CONTACT: Dr. David Fox, 401-331-9640, Dr. Douglas L. Reilly, 401-331-9640, or Burton Arkin, 212-599-2369, all for NESTOR, Inc./

CO: NESTOR, Inc. ST: Rhode Island IN: CPR SU: CON

TW -- NY006 -- 0626 09/10/93 09:04 EDT
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Publication:PR Newswire
Date:Sep 10, 1993

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