Cadix International Inc., a software company based in Atlanta, has developed an on-line signature verification system that company officials claim detects nearly 100% of unauthorized signatures.

The system uses a terminal equipped with a pressure-sensitive writing tablet to capture signatures electronically. Once captured, a signature is then compared, using biometric technology, to an authorization file containing valid signatures for a given account.

Developed with the banking industry in mind, the system can be used for a range of applications, including check endorsement verification, vault and safety deposit box access, and identification at the point of sale.

"It performed well under tests and basically won't allow any false accepts," said Steve Hollingsworth, marketing director at Cadix.

The process is based on proprietary pattern recognition software that Cadix has been refining for 10 years. Company officials claim it can accept or reject signatures within a second.

Though no banking company has purchased the system, Mr. Hollingsworth said Cadix is in discussions with two financial institutions, which he declined to name. The company will soon launch a pilot with a credit union, he said.

At least one banker expressed mixed opinions on adding such a product to the bank's operations.

Bruce P. Brett, senior vice president with Signet Banking Corp., Richmond, Va., said that the process of creating a data base containing images of customers' signatures may be impractical.

"I'm generally positive toward any effort to reduce fraud," Mr. Brett said. "I think any bank would be interested in such a system, but I'd question its convenience and reliability."

Although several virtually flawless methods of positively identifying a person exist - including electronic retina scans and handprint analysis - none are generally feasible for the banking industry, experts said.

As such, the industry generally relies on passwords or personal identification numbers, which can be stolen.

Experts consider biometric identification a good alternative to current methods because the technology relies on individual characteristics that are difficult to copy.

In retina scanning, for instance, an infrared laser shoots into the eye to recognize unique patterns. Likewise, fingerprint analysis is virtually foolproof.

But Mr. Hollingsworth maintained that as good as these identification techniques are, consumers are unlikely to embrace them. The criminal connotations of fingerprinting and the perceived dangers of retina scanning would be too much for a bank to overcome in using the technologies.

However, Mr. Brett said that banks, though cautious, are constantly looking for better antifraud options. "Everyone's looking for the magic bullet," he said, "and I'm convinced there is none."

The Cadix system can be used as a stand-alone module or networked as part of a larger system. The software can communicate with a host computer using local or wide area networks or dial-up communications. Verifications can be sent long distances over high-speed transmission lines within three to five seconds.

Signature templates occupy 1.5 kilobytes of disk space, allowing 20,000 signatures to be stored on a 40-megabyte hard disk. With such storage requirements, the technology readily lends itself to service bureau offerings, though storage is becoming less of an issue as technology evolves, Mr. Hollingsworth said.

"If you think about it, it doesn't matter where the signature is," Mr. Hollingsworth said. "It could be on a two-dimensional bar code, which can hold two or three signatures, or on a smart card."

The tablet and a copy of the software starts at $1,500. Volume discounts are available.

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