Bermuda-based First Atlantic Commerce announced yesterday that it has linked up with a San Diego company to offer new security tools to protect the transactions of Internet merchants.

First Atlantic, an offshore processor of online payments, signed an agreement with HNC Software Inc. to launch eFalcon, an Internet bank card fraud detection system. The two companies will work in tandem to market secure e-commerce and fraud detection solutions to the international market.

"This alliance allows us to help our merchants establish an added layer of protection for their e-business,'' said First Atlantic CEO Andrea Wilson.

"Transactions going through the First Atlantic Commerce payment gateway are secure. Some merchants require an added level of defence at the site itself, which the eFalcon system can provide.

The system will use various features to distinguish between legitimate shoppers and fraudulent purchasers, while helping merchants to save legitimate transactions that may appear risky. eFalcon will incorporate set policies for accepting and declining transactions and is based on widespread technology developed by HNC over a ten-year period. "Internet merchants are concerned about fraud perpetrated online, since they are responsible for losses incurred through card-not-present transactions,'' said Walter Lee, vice president of Internet risk products for HNC Software.

"It is important to establish security measures at all the potential points of failure. With First Atlantic Commerce's high level of security in its services, plus the advanced online fraud detection capabilities of the eFalcon system, merchants are well protected from potential bank card fraud.'' Ms Wilson of First Atlantic said the company was pleased to be working with HNC.

"This is yet another feature that will differentiate us from other service providers,'' she said.

HNC traded higher on the NASDAQ yesterday, ending the day up $2.50 at $56.