PerfectData Hopes to Cash In With Internet Currency System

At the start of the year, officials at Simi Valley’s PerfectData Corp. were focused on computer and office care and maintenance products. Last week at the Comdex Internet Showcase in Las Vegas, they were touting such things as cyber-cash and cyber-stock trading.

It’s been an eventful year.

“We are now more of a concept company than a mundane cleaning products company,” said Joseph Mazin, chief executive of PerfectData.

Earlier this month, PerfectData introduced its Perfect-Cash concept, by which it will partner with financial institutions and serve as an intermediary between customers and companies buying and selling merchandise over the Internet.

Instead of using credit card numbers to make purchases, customers would establish accounts with PerfectData and pull the cash from those accounts when needed. PerfectData would link its site on the World Wide Web to those of other merchants to facilitate the transactions.

“We are creating a new currency,” Mazin said. “A lot of customers don’t want to put their credit cards out there when using the Internet to make commercial transactions, and businesses will be able to take in the Perfect-Cash and redeem it for U.S. dollars or Hong Kong dollars or British pounds.”

Mazin said his company will provide the Internet and financial services for free, garnering revenues from the interest accrued while a costumer’s money is in its Perfect-Cash account. Money will need to remain with PerfectData for a minimum of six months before it can be withdrawn.

Initially, PerfectData will use Perfect-Cash to sell its own products and those of Starnet Universe Internet Inc., a Web server and Internet provider the company purchased over the summer. The payment system is expected to be operational by March.

Mazin said other companies have shown interest in the idea, and he anticipates increasing demand for such transactions.

“This is something that’s going to be huge whether we do it or somebody else does it,” Mazin said. “There are other start-ups attempting to do something similar. In the Internet field it is basically first come, first served. You’ve got to get your hat in the ring fast.”

Catalog businesses would be the most likely customers, Mazin said, but a number of businesses could benefit.

“Service agencies would benefit, travel agencies,” he said. “It could be almost anything.”

The introduction of Perfect-Cash comes just months after PerfectData introduced PerfectTrade, a service by which users will be able to buy and sell stock over the Internet. PerfectTrade software will allow prospective buyers and sellers to make initial contact by way of an Internet message board.

PerfectData introduced the idea in April and received approval from the federal Securities and Exchange Commission in August.

Bob Barbabella, owner of Data Connections computer service and training store in Simi Valley, said the time is right for a more secure way of doing business over the Internet.

“When you start buying stuff over the Internet, you put your credit card on somebody’s order form, and there are risks that other people are going to see it, maybe even the wrong people within that company,” he said. “There’s always so many scam artists. There’s a lot you’ve got to be careful with.”

Barbabella said the cyber-cash idea, if handled correctly, would be particularly useful for operations that do a large percentage of business over the Internet.

“It would be very feasible for expediting transactions because the money is already there,” he said.

PerfectData posted net earnings of $1,000 on sales of $2.9 million for the six-month period ended Sept. 30, compared with a net loss of $87,000 on sales of $3 million for the same period in 1995.