June 16, 2009
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News: How Safe Is Your CC Information?
Just how safe is a consumer's credit card information each time they swipe their cards? The Federal government entrusts the awesome responsibility of protecting this information to the banking industry. It is their responsibility to devise and maintain a set of standards for credit card security. The financial industry utilizes the Payment Card Industry (PCI) security standards to fulfill this responsibility. The Associated Press (AP) set out to discover what kind of security measures are taken in protecting consumers' information. They found that although banks are meeting standards, the rules are superficial and lack adequate security. The AP examined the records of the Privacy Rights Clearinghouse and found that just since 2006, more than 70 organizations reported information breaches. The report showed that consumer credit card information is at risk and open for access each time the card is swiped.
According to the report, a colossal data breach occurred at the Hannaford's supermarket chain. Thieves hacked the company's system and accessed consumer credit card information after making a purchase while en route to the bank. Two other breaches that placed millions of consumers' information at risk involved two major card processing organizations, Heartland Payment Systems and RBS WorldPay, Inc. The AP also discovered that the list of breaches was not comprehensive and that the actual number of incidents is unknown; a scary thought for most credit card owners. Despite the limited data, the information does provide a general guideline of the various types of breaches. Such data can be very helpful in determining where the holes are.
According to the AP, their resources indicated that approximately 93% of large credit card companies and 88% of mid to smaller size companies meet the industry standards. Companies that do not meet the PCI standards are subject to monthly fines that range from $5,000 to $25,000. However, the lack of a set of comprehensive standards leaves consumers at great risk. Currently, to beef up security, the PCI is working on measures to tighten control and hold processors more accountable.