Arcot Systems Among the Top California Technology Companies to Join Governor Arnold Schwarzenegger's Trade Mission to China

Leader in Strong Authentication for Financial Institutions is Only Security-focused Company Selected as Part of Key Banking Technology Roundtable in Beijing

Sunnyvale, CA -- November 15, 2005 — Arcot Systems, Inc. (Arcot), a leading provider of online authentication and identity management solutions, announced that the company will be amongst California's most influential technology providers speaking on a banking and technology roundtable today as a part of Governor Arnold Schwarzenegger's “Mission to China” California trade initiative. Arcot will join other roundtable participants, including executives from Sun Microsystems, Hewlett Packard, East West Bank, Wells Fargo, Comerica and Silicon Valley Bank, along with 11 Chinese city commercial and national shareholding banks and several high-level participants from the China Banking Regulatory Commission.

Keith Goldstein, Vice President of Worldwide Channel Development, will represent Arcot at the roundtable. Topics for roundtable discussion include recent China banking reforms and the ways in which California banks and financial services technology companies can help provide effective solutions such as software-based strong authentication and secure digital signing. The roundtable will be held at the Tsinghua University in Beijing from 11:00 a.m. to 12:30 p.m.

Arcot is the only online security-focused company participating in Governor Schwarzenegger's California trade mission, which includes some of the most renowned names in banking and technology in the United States. Arcot is a leader in online security software and services for the financial services sector, providing multilayered authentication solutions to a number of top banking institutions. The company's TransFort™ solution is the world's leading software for implementing the Verified by Visa™, MasterCard SecureCode™, and JSecure™ by JCB online card payer authentication programs, enabling both user authentication to the issuing bank, and bank authentication to the individual consumer. In addition, the company's ArcotID™ core strong authentication technology is a software smart card that allows for strong, multi-factor authentication that provides a scalable solution for large-scale Internet banking and other online transactions. The ArcotID solution offers a cost-effective, easier-to-administer and deploy method for issuing strong authentication credentials on a large-scale basis -- to millions of customers – without the shipping/handling/customer service costs typically associated with hardware tokens, physical smart cards, or scratch cards.

“Scalable and strong multi-layered authentication solutions are more important than ever today and Arcot is honored to be chosen as one of the California technology providers represented on this trade mission. It speaks to Arcot's relevance for addressing the financial business requirements in China and really, throughout the world, as more and more financial transactions are occurring online,” said Keith Goldstein, Vice President of Worldwide Channel Development for Arcot. “Our authentication and digital signing solutions have enabled the increasingly regulated financial organizations in the Asia/Pacific region and other parts of the world to streamline their Internet operations while increasing the overall level of security for the institution, protecting businesses from fraud, and securing the digital identities of millions of people.”

Arcot addresses many of the online security issues faced today by banking institutions in China and other parts of the world - including brute force attacks, man-in-the-middle attacks, keylogging trojans, and phishing attacks. The company's multi-layered security solutions prevent hackers from accessing proprietary online systems at various levels by authenticating both the consumer to the bank, and the bank to the consumer.

In the U.S., Arcot supports recent FFIEC recommendations for the use of stronger authentication beyond username/password -- the company provides a software strong authentication solution that specifically addresses the concerns outlined in the recent report, Authentication in an Internet Banking Environment. Highly influential in the U.S. banking industry, the FFIEC (Federal Financial Institutions Examination Council) makes recommendations and develops standards to promote uniformity in the supervision of financial institutions. Arcot's solutions enable banks to implement true strong authentication within their existing infrastructures, while maintaining the user-friendliness of passwords. For a copy of the Arcot solution brief, Strong Authentication for Consumer Banking Portals: Meeting FFIEC Requirements Using Software Strong Authentication, contact FFIEC@arcot.com.