Can Validating PCI Compliance Increase Your Vulnerability To A Breach?

Written by Walter Conway
January 25th, 2010

A 403 Labs QSA, PCI Columnist Walt Conway has worked in payments and technology for more than 30 years, 10 of them with Visa.

It may sound like heresy coming from a QSA, but I see some merchants over-emphasizing their PCI annual assessment. The main event for them is a clean Report on Compliance (ROC) for Level 1 (and soon Level 2) merchants or a Self-Assessment Questionnaire (SAQ) for everybody else. They believe that once the ROC is signed, they can relax until the next year.

But PCI is not like that. PCI has requirements that demand regular attention if merchants are to remain compliant the other 364 days in a year. CIOs and merchants who focus only on their annual PCI validation may actually find that they unintentionally make themselves more vulnerable to a costly data breach. They also make their PCI revalidation the following year more difficult, and possibly more expensive, than it has to be.

Let’s get one thing out of the way: PCI validation is not the same as PCI compliance. Validation is an assessment or judgment based on evidence. It is something you do once a year. Compliance is different. It is a state where you, the merchant, actually meet all the rules and procedures every day.

Let me give two examples of the difference between validation and compliance. You can validate without being PCI compliant. Simply lie to your QSA or on your SAQ. Alternatively, you can validate conscientiously. But after someone changes a firewall rule or adds a wireless network or fails to check a system log, you are out of compliance in a matter of days or even hours.

Validation is important. I personally believe merchants should celebrate their completed ROC or SAQ. I tell clients they should send out for pizza and distribute some gift cards to everybody who worked so hard. As you clean up those empty pizza boxes after lunch, though, I want to ask yourself one question: It has been at least an hour; what in the world makes me think I’m still compliant?

I have never liked the card brands’ statement (echoed by the PCI Council) that no PCI-compliant organization has ever suffered a data breach. This statement highlights the distinction between validation and compliance. That you validated your PCI compliance a few weeks or months ago says very little about your present state of compliance. I personally wish everyone would stop repeating this mantra–I hate to taunt the bad guys, who have enough economic motivation already–but the brands and the PCI Council are justified.

Compliance is a 365-day-a-year job. It is true that many assessors and even the PCI Council refer to validation as being backward looking. What they mean is that your ROC or SAQ indicates you were PCI compliant at a certain date. But your ROC or SAQ says nothing about your compliance going forward. I want to propose a different description of PCI compliance, one that emphasizes the merchant’s ongoing responsibility. After all, the DSS contains a number of specific actions that you need to perform on a regular basis to remain compliant.


One Comment | Read Can Validating PCI Compliance Increase Your Vulnerability To A Breach?

  1. Dave CISA/M/SP Says:

    Nice Article and well said!

    IMHO one of the major root causes here is the perception that Security is borne of Compliance, when in fact the reverse is true. There are a couple of old sayings regarding ‘luck” – it is when preparation meets opportunity, and it is the residue of design – that can be applied here. Let’s replace “luck” with “security”, and see what we get, shall we?

    Security is the residue of design

    Security doesn’t just happen. It’s policies, procedures, awareness, attitude, culture, decisions, and a thousand other things that add up to your security posture.

    If your CEO is meeting with Security and Audit quarterly, if security has a top-down focus and is baked into everything you do by policy, process, and procedure, and if security is something EVERYONE is responsible for, your security posture could be as ramrod-straight as you get outside a classified environment.

    If security is something the Info Sec team is responsible for, if security is something you do when it’s easy but not when it’s hard, if security is something you do once a year so you can complete some paperwork, then your security posture is likely similar to that of the late Mr. Loopner (you remember him, right? Lisa’s dad? invetor of the slinky? And most important in this context: born without a spine!)

    Security is what happens when preparation meets opportunity

    Every year yields another “opportunity” to be secure. It’s PCI now. Before that it was HIPAA, before that, Sarbanes-Oxley, before that Graham-Leach-Bliley. You can’t survive in an environment like this by dealing with each of these challenges tactically. You’ll wind up trapped in a career-killing vicious circle of react and spend, react and spend.

    The only way to deal with the never-ending barrage of new requirements is to have a comprehensive, standards-based information security program. When new “opportunities” arise, you will be able to quickly identify and report to management the 90% of the requirements already being met. By extension you can then either (a) identify the resources you need to implement, (b) propose compensating controls to address in lieu of resources, or (c) accurately describe the potential costs associated with accepting the risk.

    In closing – I believe the Council and the brands stick pretty close to “to our knowlege, no organization to date has been found PCI DSS compliant at the time of compromise” to avoid potentially impugning PCI DSS compliance in the context of merhcant compromise.


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