Given the recent credit card mega-breach at Target, it’s no surprise that the Feds will soon be jumping in to add a new layer to the already existing compliance guidelines and regulations. I’m sure this seems like a reasonable response for many, given the publicity around this breach and the potential for widespread fraud that could result. But as usual, I am concerned that Congress will be placing an undue burden on credit card processing companies instead of taking a balanced look at the industry as a whole.
Thankfully, Congress is considering ways to make credit and debit cards more secure. I’d suggest they take a good look at Europe, which has been ahead of the US for some time in this area. For starters, the smart card technology that many European countries have adopted is extremely difficult to duplicate or forge and has built-in tamper-resistance. It’s been about a decade since card issuers in EU and Japan started using smart chips. And in that time, it’s no coincidence that the US has become a high-value target in the fraud game.
Unless Congress adopts new regulations that require card issuers to update their technology, the real issue will never be addressed. By avoiding new technology Continue reading