Heartland Payment Systems
| Company type | Public (until 2016) |
|---|---|
| Industry | Payment technology and processing |
| Founded | 1997 |
| Founder | Robert O. Carr |
| Defunct | 2016 |
| Fate | Acquired by Global Payments |
| Successor | Global Payments Inc. |
| Headquarters | Princeton , United States |
Area served | United States |
Key people | Robert O. Carr (founder, CEO) |
| Products | Payment processing, payroll services, gift and campus card programs, point of sale solutions, school payment and nutrition management, network administration, mobile payments and ordering platforms, eCommerce capabilities, billing systems, lending services |
| Owner | Global Payments (since 2016) |
Number of employees | Over 8,500 (as part of Global Payments after merger) (2016) |
| Parent | Global Payments |
Heartland Payment Systems, Inc. is a payment technology and processing firm based in the United States, established in 1997. Its most recent corporate office was situated in Princeton, New Jersey. In 2016, the company was purchased by Global Payments for $4.3 billion.
Serving more than 275,000 merchant locations nationwide, Heartland handles over 11 million transactions each day, amounting to upwards of $80 billion annually as of 2014. The company's offerings extend beyond payment processing to include payroll services, gift and campus card programs, point of sale solutions, school payment and nutrition management, network administration, mobile payments and ordering platforms, eCommerce capabilities, billing systems, and lending services.
History
Founded in Princeton in 1997 by entrepreneur Robert O. Carr, Heartland secured a $40 million private equity infusion in 2001 from Greenhill Capital Partners and LLR Partners. The company made its debut on the New York Stock Exchange on August 11, 2005.
Security breach
On January 20, 2009, Heartland disclosed a security incident affecting its processing infrastructure dating back to 2008. The breach involved unauthorized access to data encoded on the magnetic stripes of credit and debit cards, which allowed criminals to manufacture counterfeit cards. It was estimated that as many as 100 million cards and over 650 financial institutions were impacted, representing one of the largest known card data compromises.
Albert Gonzalez, identified as a computer hacker involved in the incident, received a 20-year prison sentence in March 2010 for his participation in the Heartland breach. Additionally, two Russian hackers were sentenced in February 2018 for related cyber offenses.
By May 1, 2009, Heartland had demonstrated compliance with PCI DSS standards and was reinstated on Visa's roster of PCI DSS Validated Service Providers, reaffirming its dedication to security protocols and regulatory adherence.
End-to-end encryption
On May 24, 2009, Heartland introduced its E3 end-to-end encryption technology designed to safeguard credit and debit card data from the point of swipe throughout the Heartland network. Gartner analyst Avivah Litan recognized Heartland as an innovator within the US market for this advancement. Following this development, competitors such as Worldpay US and several First Data independent sales organizations also launched end-to-end encryption solutions, underscoring Heartland’s early leadership role in secure payment processing technologies.
Open letter to the electronic payments industry
In October 2013, Bob Carr, CEO of Heartland, spoke at the Strategic Leadership Forum hosted by the Electronic Transactions Association and subsequently issued an open letter criticizing unethical pricing strategies prevalent in electronic payment processing. He condemned practices including misrepresenting interchange rates and merchant category codes (MCC), as well as employing ambiguous fine print to impose excessive penalties on merchants—highlighting Heartland's pledge to uphold transparency and ethical standards within the industry.
Legal Action against Mercury Payment Systems
In January 2014, Heartland initiated legal proceedings against Mercury Payment Systems, a provider of electronic payment solutions, accusing them of false advertising and misleading trade practices concerning interchange fees imposed by credit card networks. The complaint referenced infringements under the Lanham Act as well as various state regulations.
Introduction of Heartland Secure
Heartland Secure was introduced in May 2014, combining three technologies supported by a breach warranty designed to shield merchants from the financial impact of stolen card data, thereby bolstering the company’s security portfolio.
Combination with Global Payments
In April 2016, Heartland joined forces with Global Payments, resulting in the formation of Global Payments Inc., a publicly traded entity (NYSE: GPN) with a workforce exceeding 8,500 employees worldwide. This merger substantially increased its international reach and market presence.
Strategic Acquisitions
- May 30, 2008 – Acquired Alliance Data Systems to extend payment processing capabilities within petroleum, convenience store, parking, and retail industries.
- November 18, 2008 – Purchased Chockstone to improve gift card and loyalty program offerings.
- January 1, 2011 – The School Solutions segment acquired LunchBox software from Data Futures, enhancing K-12 nutrition and point-of-sale services.
- October 11, 2011 – Bought School-Link Technologies to expand K-12 school nutrition and POS solutions.
- July 9, 2012 – Acquired LunchByte Systems to integrate back-office management and POS for K-12 administrators.
- December 17, 2012 – Strengthened Campus Solutions by acquiring Educational Computer Systems (ECSI), specializing in higher education payment processing.
- January 7, 2013 – Enhanced Payroll Services through the acquisition of Ovation Payroll, providing payroll tax preparation and management.
- February 15, 2014 – Purchased Merchant Software Corp., delivering POS systems tailored for the liquor retail sector.
- April 10, 2014 – Acquired MCS Software to support over 4,000 K-12 schools with foodservice POS and online payment solutions.
- August 14, 2014 – Added Leaf, a pioneer in mobile POS tablet technology.
- September 4, 2014 – Integrated TouchNet Information Systems to offer comprehensive commerce solutions for higher education institutions.
- November 1, 2014 – Acquired XPIENT Solutions to advance enterprise-level restaurant POS software services.
- February 13, 2015 – Expanded restaurant and retail POS offerings by acquiring Dinerware and PC America.
- March 1, 2015 – Broadened payroll and tax filing services across various sectors through the acquisition of Payroll 1.
- October 30, 2015 – Strengthened restaurant-focused POS capabilities by acquiring Digital Dining.