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Fighting Words: Why PCI’s Token Group Blew Up

August 17th, 2011

Ulf Mattsson, the CTO at Protegrity and another participant in the PCI process, said the issue of taking something out of scope and putting things back in scope is critical, and that retailers need to know concretely what will happen if they take specific actions. “When you push out the tokens in the dataflow, there is no way back,” he said. “It’s in the bloodstream of your enterprise.”

Mattsson, like many others, expressed disappointment more for what was not ultimately covered in the guidelines than for what was.

“It took too long to get this supplement out. I have seen so much material that could have been part of this supplement,” he said, citing one example of the need to now revise the self-assessment form. “We need to add questions that assess the tokenization area. It’s a gaping hole.”

Another area of concern for Mattsson is the token training that QSAs will have to go through. “If we had a more detailed guidance document, then less training might be needed. And I would like to see a roadmap for future validation, an independent technology validation.”

Mattsson also described the token group’s reorganization and how that delayed the guidance. “I think it escalated when we tried to finalize the document. One vendor pushed its encryption and we spent a lot of time fighting about that,” he said.

Merchant Link’s Zloth said PCI Council management opted to reorganize the group—officially a PCI SIG—by adding more PCI staff people. “The Council decided they were going to put resources on it. Definitely there was a shift from the participating organization-led group to the PCI Council-led group,” she said. “It was a shift of people and a shift in what the document ended up looking like.”

What was the nature of that shift? “The earlier draft was a combination of a guidance document and a validation document,” Zloth said, adding that the final version was solely a guidance document. A validation document would typically trigger a validation program, which would involve training, lab work and other items.

The PCI Council was “not prepared to create a whole validation program for tokenization,” she said, especially given the fact that PCI is just about to release the full validation treatment for point-to-point encryption.

Although the compromises were needed to get the document published, a more specific report could have been helpful, Protegrity’s Mattsson said.

“My view is that the Council and some card brands are very nervous about new and unknown risks that tokenization may introduce. They point to the QSA, but there is no training or check list available or announced to help the QSA,” he said.

The CEO of another tokenization vendor, Shift4, touched on the inherent conflicts in any association such as PCI.

“The greatest balancing act for the PCI Council is not a product of balancing different merchant types or even balancing giant retail chains with mom-and-pop shops. Rather, their biggest roadblock is their apparent desire to satisfy (or balance) all of the needs of the various third parties that have a product to sell,” said J. David Oder. “There is a lot of money in security solutions and the pressure on a standards body is immense.

“A weak standard is one thing, but the caveat that merchants and their banks should consult their QSA is indicative of the weakness of PCI. What good is a standard if it has been delegated to 100 different organizations with 100 different opinions, especially when some of the opinions are so obviously swayed by the fact that they sell their own tokenization or end-to-end encryption products?” Oder said. “The QSA community was created by the PCI Council. Yet, unlike many other standards bodies, the Council has not yet created a prohibition on conflict of interest for QSAs. They likewise have no mechanism to arbitrate conflicts between merchants and QSAs, between QSAs, or between suppliers and QSAs.”


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