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CHARLOTTE … Attus Technologies, created in 1998 to sell software and consulting to help banks and financial institutions address U.S. foreign asset regulations, was ready with the right product when 9-11 focused attention on terrorist financing.

“What we did was create a product and sold it to about 200 financial institutions before 9-11 hit,” says Trey Sullivan, president, chief executive and founder of Attus. The software product helped financial institutions comply with the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) regulations.

The OFAC also establishes a list of “bad guys,” as Sullivan puts it, and the U.S. government can issue economic sanctions against anyone doing business with them.

Sullivan funded Attus initially. Then it raised $700,000 in venture backing from Charlotte Capital Partners Plus. Attus sold a software product called OFAC Watchdog.

After 9-11, the already struggling tech economy fell apart and many startups died. However, 9-11 also brought new government scrutiny and regulations to financial industries.

“Our business flourished during that terrible period,” Sullivan says. “We sold 2,000 pieces of software over the next 12 months. It was a roller-coaster despite the bad things going on around us.”

More products

Attus now offers eight more products addressing compliance with the USA PATRIOT Act, the Financial Crimes Enforcement Network, Bank Secrecy Act, Fraud Prevention and Anti-Money Laundering, and OFAC. The company recently introduced its latest product, Web-based training. Sullivan says the company’s services cost from a few hundred dollars to $75,000.

The company is a “different animal” from its competitors, who tend to be either software companies or consulting firms, he says. Talking to LTW from the American Bankers Association Regulatory Compliance conference in Chicago, Sullivan noted that a hot topic there is that “the crooks are moving to community banks.”

“Criminals are using all sorts of things to get funds into this country and use them against us, such as real estate. It’s not getting easier to detect money laundering. The hot topic is how do you combat it?”

Sullivan says large banks and financial institutions have already installed sophisticated money laundering detection systems, but the cost — from $450,000 to $1 million — is more than smaller community banks can generally stomach. So “bad guys” who want to commit fraud, money laundering, or feed funds to terrorists are moving to less protected small banks. “We’re trying to find a way to crack that nut and provide the sophisticated tools in a less costly way,” Sullivan says.

Acquired in 2003

The company, which has 21 employees in Charlotte, was acquired for several million in May 2003 by Computer Services Inc., (OTC:CSVI.PK) based in Paducah, Kentucky. CSI, a former Attus’ customer, serves about 500 financial institutions with 32 offices in 18 Midwestern states and Texas.

Attus’ 2,400 customers include such marquee names as Fleet Financial, BB&T Investment Services, Belk Card Services, VISA International, and the Hartford Insurance Company.

Attus, says Sullivan, plans to expand its business vertically this year, moving into other industries such automotive, jewelry stores, and travel agencies, which also have to comply with new homeland security and fraud and privacy protection laws.

Sullivan notes that it’s a challenge drawing a fine line between privacy and protection. “You have to protect privacy but give law enforcement enough data to catch the bad guys. I think this is going to be a way of life for the foreseeable future.”

Sullivan says Attus will probably make some acquisitions as it grows. He notes that several of the companies’ competitors have merged with other firms and that the industry remains somewhat fractured and dispersed.

He also says working in Charlotte, the nation’s second-largest banking center has had distinct advantages. “Charlotte is fantastic. People there understand our business. Most of our employees have banking experience and understand bank technology. We have a good pool of additional people here we can draw from, too.”

Attus Technologies : www.attustech.com