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Visa Yanks Global Payments’ PCI Compliance. Catch-22 In Full Force

Written by Evan Schuman
April 1st, 2012

Visa has now yanked the PCI compliance away from processor Global Payments, following word of a potentially huge data breach. Visa’s move, based on its initial comments, both supports the seriousness of PCI and simultaneously makes it seem pointless.

The problem is not Visa removing a company that is not compliant from its compliance list (note that MasterCard hasn’t. More on that in a moment). The problem is the perception that Visa is doing this as a kneejerk reaction to a breach—this de-list first, ask questions later approach—not because it established anything concrete and specific.

On Sunday (April 1), Visa officially removed Global Payments from its PCI compliance list. (You thought you were compliant? April Fools! You no longer are.)

This is Visa’s official statement: “On March 30, Global Payments publicly disclosed unauthorized access into a portion of its processing system, resulting in the potential compromise of payment-card account information from all major card brands. Based on Global Payments reported unauthorized access, Visa removed the company from its registry of PCI DSS-validated service providers. Per our normal process, Visa has asked Global Payments to revalidate its PCI DSS-compliance. The PCI DSS has proven to be a highly effective foundation of minimum security standards when fully, correctly and consistently implemented across all systems handling cardholder data.”

When asked if there were any reasons—beyond the fact that the processor was breached—that Visa made this change, such as Visa being aware of false statements or incomplete answers Global Payments might have given to its QSA or if it had changed anything since the last assessment, Visa spokesperson Sandra Chu on Wednesday (April 4) said: “The investigation is ongoing, so there are no details I can share. We’ve asked them to revalidate and, in the meantime, given the obvious questions, we’ve removed them from the list.”

Related Column From Walter Conway: Visa To Global Payments: Strike One, You’re Out

There always exists the possibility that Visa is, indeed, aware of information that would justify Global Payments being removed from the list. But the statements to date seem to reinforce the idea that this was solely because of a breach having happened.

Note that this is a sensitive matter, but Visa could have easily addressed this without revealing anything. For example, something like this would have likely cleared the lawyers: “There were reasons beyond the breach merely having happened that prompted our decision. We can’t reveal what those reasons were, but rest assured that we didn’t take this action solely because of bad guys getting through.”

The explanations offered to date from Visa reinforce the fears of every retail IT security exec who is desperately trying to justify all of the time, effort and money being spent on PCI compliance.

The fear is that PCI compliance only exists up to the moment it’s needed. PCI doesn’t deliver security, of course, because it’s only an entry-level checkpoint. Besides, retailers could implement all of those best practices without the headaches associated with repeated compliance exercises.

Avoiding fines, although nice, is rarely a huge concern among the major chains. No, the real reason to be compliant is to have that declaration in case you’re breached, something the lawyers can use when fighting off class-action lawsuits, something the board can point investors to and something PR can point customers to. Why spend all of that money with the QSA process if you’re automatically—and retroactively—declared non-compliant when any breach happens?

On the breach itself, Global Payments is now saying it was limited to North America and the number of card numbers taken was fewer than 1.5 million.

“The investigation to date has revealed that Track 2 card data may have been stolen, but that cardholder names, addresses and Social Security numbers were not obtained by the criminals,” the statement said. “Based on the forensic analysis to date, network monitoring and additional security measures, the company believes that this incident is contained.”

Now, back to the problem with Visa having thrown Global Payments off the PCI compliance list so quickly. Let’s say a homeowner has done everything within reason to protect her home: state-of-the-art monitored security systems, triple redundant protection throughout the house, bars on every locked window, steel door reinforced with high-security deadbolts, armed guards patrolling the premises 24×7, etc.. That doesn’t mean a clever, persistent and well-financed burglar couldn’t still break in.

The point? Just because someone breaks in doesn’t necessarily mean the homeowner was at fault for not adequately protecting her property. The same is true for retailers and processors.


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5 Comments | Read Visa Yanks Global Payments’ PCI Compliance. Catch-22 In Full Force

  1. Chris Says:

    So PCI compliance can not guarantee that a provider will not be breached, but a breach is inherent evidence of non-compliance? Any comment from VISA as to whether they will continue to accept ROCs prepared by Trustwave? Seems like an inconsistent position.

  2. Thu Says:

    Global Payments reported they were working toward being in compliance with PCI, despite already being on the list. In a backwards way, they admitted they were not previously in compliance. We can’t really say that a breach is inherent in these type of situations without having a full investigation report. That’s one reason why MasterCard is waiting to see what forensics finds before yanking them from their list.

  3. Steve Sommers Says:

    In the past, Visa has stated, “No compromised entity to date has been found to be in compliance with PCI DSS at the time of the breach. In all cases, forensic investigations have concluded that compliance deficiencies have been a major contributor to the breach.” This quote can be taken two ways. Either PCI is perfect and all-encompassing and compliance guarantees you won’t be breached; or there are so many “gotchas” in PCI that no one can escape non-compliance. I personally believe that PCI is written in such a way — and interpretations among QSAs vary so much — as to make it impossible for anyone to be 100 percent compliant 100 percent of the time. From the simple fact that Global was breached, PCI non-compliance was already a fait accompli. My hope is that someday the card brands, law enforcement, and the media will prosecute the hackers and thieves as harshly as they prosecute merchants, banks, and processors for non-compliance.

  4. Biff Matthews Says:

    PCI, TSA, IRS – obviously none of these functions as intended or as promoted. I’ve said it before and I say it again, hackers are free of personnel, budget, expertise, infrastructure and time constrains. Nothing, NOTHING, is ever fully safe. Visa and its attorneys simply choose to hide behind the false sense of security of the PCI veil. Truth be known, Visa has probably been hacked. Anyone see the similarities between VISA and the wizard of OZ?

  5. Steve Sommers Says:

    This begs the question, how does this decision by Visa affect Third Party Processors (TPA’s)? Our TPA agreement has wording to the effect that we can only send CHD to PCI compliant processors and banks. Now that Visa has deemed GPS non-compliant, are we breaking our TPA agreement by allowing our customers to continue using GPS?

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