History

Privately held, Smart Systems was founded in January 2004 in efforts to localize Korean contactless card based technologies in America. The project was created by John J. Lee, General Manager of US Operations of C&C Enterprise Co., Ltd. of South Korea at the time, a specialist in contactless payment, and the management team here headed by Michael J. Simon. After three months of extensive evaluation of the business opportunity, the two principal officers began working full-time at the end of December, 2003. At that time, Smart Systems was formed as a New York LLC and established an office in New York City. In May 2004, Mr. John J. Lee left his duties as General Manager of C&C in order to devote full attention to the US market through Smart Systems.

Transit agencies in the U.S. have been moving away from magnetic-stripe to contactless cards. Recently, major U.S. banks have started to issue contactless bankcards on a large scale. While the agencies want to offload card issuance and management to the financial industry, the issuers want the card distinctiveness and top-of-wallet effect given by transit use. To unite the two industires, an anti-fraud solution is necessary.

Smart Systems was specifically formed to develop and deliver the IP of offline authorization. It owns thenecessary patented technologies developed and currently in use in Korea that allow the offline authorization of credit/debit card transactions using a negative list. Seoul’s mass transit has been using a credit card-based AFC system since 1996. Eight Korean financial institutions have issued nearly 30 million transit credit/debit cards to date, which have become the main form of transit pass in Seoul’s subways, buses and taxis.