Banking Group Accuses TJX Of Improperly Retaining Personal Data

Written by Evan Schuman
January 19th, 2007

Two days after confirming that driver’s license data was intercepted during a major intrusion last month, TJX officials have been directly accused of retaining “unnecessary” personal data, possibly in violation of PCI rules.

“We think it’s a little odd that (TJX) would characterize themselves as victims when it appears that they may have been capturing data that is unnecessary,” said Daniel J. Forte, president of the Massachusetts Bankers Association. Forte’s group is lobbying for a state law change that would force retailers who are recklessly lax in their security procedures to pay for the cost of repairs.

“When a bank must issue new cards due to a retailer’s data breach, it can add up to a significant expense considering that thousands of cards could be involved. MasterCard, and now Visa, has in place a process for banks to make claims for the cost of re-issuing cards. However, there is no guarantee that the full amount will be reimbursed,” Forte said. “Additionally, there is the fraud issue. If a fraud does take place, MasterCard and Visa have a zero liability policy in place for the benefit of consumers, which is good. However, the cost is borne by the bank even if the retailer is responsible for a major violation of the card association rules resulting in fraud. Does this make sense?”


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Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

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