Inventor of bank card Pin hit by lack of credit

While he was credited with creating the system that authenticates billions of pounds of cash machine transactions every day within weeks of the invention, the anniversary is giving him the chance to try to lay to rest a counterclaim that it was another Scot that was the real brains behind the ATM (automated teller machine).

Mr Goodfellow was working for Kelvin Hughes, the Glasgow-based marine systems arm of the then Rutherford-Smith, which became Smith’s Industries, when he was tasked with creating a secure method for the public to withdraw cash from new unmanned machines at the then Midland Bank, now part of HSBC.

The invention was required after bank workers’ unions refused to work on a Saturday.

Mr Goodfellow, one of the junior members of the team, spent six weeks developing his four-digit Pin, combining it with a plastic card carrying binary code unique to its bearer. The technology is still used in millions of ATMs across the world.  

A demonstration of the Pin system while mounted in a
modified candy dispenser was put together in the facilities of lock firm Chubb.

The Chubb system was first deployed by the Westminster Bank, at its Victoria branch in London on July 31, 1967. 

The Chubb MD2 24-hour dispenser seemed to win over the banking industry at large and was voted Best New Idea in the City Editor Awards the same year.

Despite the success of this development, Mr Goodfellow
was made redundant in January 1967 from Kelvin Hughes in a restructure.

While they offered to retain him and continue to develop the system if he was prepared to move the development to England, he declined and carved out a career testing computer equipment for technology company IBM in Greenock.

He says he received $1 as a token payment for each country he signed the patent licence to.

As there were 15 countries, he received just $15 dollars and has not earned a penny since.

“I left, that’s the thanks you get,” he recalled.

“What I fell victim to is that as a research and development
engineer, it was part of my job to invent things.  

“But in 1977 the law changed so that an employer inventor had to be compensated if they had an exceptionally successful invention. And the amount of compensation, if it could not be agreed, would be decided at a tribunal, that would assess the value of the patent and the appropriate reward.

“But that was not retrospective so my invention in 1966 was 11 years too early. They were happy to take the invention and made a lot of money from royalties around the world.  

“The thing that irks me about the money is that the Royal Bank of Scotland paid employees, last year, all those bonuses. And I wonder how much more worthy their input to the banking system was compared to mine.

“The money, for me is just not going to happen, I mean, it is as simple as that, it doesn’t bother me.

“I went on to work at IBM and thoroughly enjoyed it for 26 years and in the back of my mind, when I was using cash machines, I thought to myself that that was a successful project.”

But the hornet’s nest was well and truly disturbed, when to Mr Goodfellow’s chagrin in 2005, Scot John Shepherd-Barron, a retired banker from Tain, received credit for inventing the “hole in the wall” cash machine.  

He was awarded the OBE in the New Year’s Honours list for installing the first automatic teller machine at Barclays Bank in Enfield, north London, almost 50 years ago. 

Mr Goodfellow insisted that he was the true inventor, as he came up with the Pin invention, the key to making the machines actually work when he was a 28-year-old engineer.

The following year, Mr Goodfellow was finally recognised in the Queen’s Birthday Honours List, and was awarded an OBE.
“It got my hackles up. I shot to the loft and dug out my patents and wrote to the Patent Office for a copy of John Shepherd-Barron’s patent and they had never heard of him. I asked for the validity of my patent and they confirmed that.

“I patented the cash machine as everyone knows it, which involves inserting the card, key in a number, and if you get it right you get the money. That was written into the patent abstracts in 1966.   

“If someone takes the credit for your masterpiece, it does get the juices flowing a wee bit.”

More garlands followed. In 2009 he was named a John Logie Baird Award winner for Outstanding Innovation and in 2013 he was the first inductee into Paymts.com Hall of Fame at Harvard University.

But having gone to night school to get his sole further education qualification, a City and Guilds in TV engineering,  the accolade that means the most to him is the Honorary Doctorate he received from the University of West of
Scotland in November 2014.

“What irks me is that when you know you have invented something and someone else comes along like that and claims to have invented it and then you trawl through the internet and you can see that John Shepherd-Barron invented it and that has never been expunged from all the articles that were written,” he added.

“The anniversary is a good event, to put forward my own case. The patent issued by all these countries including the UK and USA is definitely a legal document and it says the date May 2, 1966 and it says the inventor is James Goodfellow of Paisley, Scotland. That to me sums it up.”

A study of the evidence from the patent records over who invented the cash machine, carried out by researchers at the Universities of Leicester and Glasgow in 2008 states that “the first and perhaps most compelling claim to the original innovation, in terms of patent evidence” was Mr Goodfellow’s development. The  report describes the claim of the late Mr Sheppard-Brown as the one that “received the most, perhaps misguided, publicity and has been prone to hyperbole”.

“I don’t know how there is any room for argument,” said Mr Goodfellow.  “But Mr Shepherd-Barron created a lot of noise and that’s the way the cookie crumbles.”