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Overpaying For PCI Compliance

March 10th, 2010

The cardholder dataflow diagram should include all your payment card activity–POS, MOTO, E-Commerce, fax, carrier pigeon, whatever. Be thorough. Think about whether you take payments at tradeshows or if you have old card data for system testing that never got purged. Should you use an automated tool to make sure you locate all your cardholder data? You might have servers and laptops containing years’ worth of PANs that you don’t know about, so it’s worth considering.

Using the two diagrams, critically question where and why you are storing cardholder data. Your goal is to reduce PCI scope ruthlessly. Here is where it pays to get some payment expertise. Can your acquirer advise you on reducing your PCI scope in areas like chargeback processing, refunds and recurring payments? Can your QSA? Can someone else? If you go the acquirer route, speak to someone with payment processing and compliance experience, not necessarily your sales rep.

Once you have completed Requirement 0 you are ready to tackle the other 12 requirements with a (hopefully greatly) reduced scope. Otherwise, you will spend too much money segmenting your network to protect unnecessary databases, configuring unneeded logging and monitoring systems, encrypting data you don’t really need and overspending to satisfy PCI requirements. The PCI Council covers scope reduction when it trains QSAs. I hope the new Merchant QSA training will emphasize it even more. (Note to Bob and Troy: We’re counting on you.)

Every merchant needs to understand that there are two immutable laws of PCI. The first is that your costs will increase. They may go up a little or a lot. Either way, you have to spend something on PCI compliance to continue to take payment cards, even if you outsource everything. It is not PCI’s fault. Blame the bad guys; they are the enemy.

The second law of PCI is that you will change the way you do things. Here is where Requirement 0 comes into play. Treat cardholder data as toxic. Seek out and eliminate cardholder data wherever and whenever you can. You likely will need to change some back-office procedures (e.g., processing chargebacks and refunds), and the inconvenience may increase your costs. But it may be cheaper than protecting cardholder data that is spread around the enterprise.

A side benefit to Requirement 0 is that it may make you more secure. No merchant is likely to be 100 percent PCI compliant 100 percent of the time. Unfortunately, the bad guys only have to be right once. That is why there are continuing compliance requirements, from quarterly vulnerability scans to daily log checks, built into the standard. When you minimize your scope and reduce the amount of cardholder data, you not only minimize your compliance effort, you reduce the attack surface for the bad guys. There is no such thing as 100 percent security, but every little bit helps.

How have you reduced your PCI scope? What has been your experience working with your acquirer? Do you think you are spending too much to get compliant? Leave a comment or E-mail me at


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