Regulatory Reality

Jul 29 2012   6:39PM GMT

Credit Card Breaches: The times they need a changin’

David Schneier David Schneier Profile: David Schneier

If my blogging about credit card breaches has a bit of a deja vu feel to it you’re not crazy, I last touched on it less than six months ago.  Sadly I was handed a new update this week in the form of my bank card being cancelled from right out underneath me again.   For those of you keeping score this would be the second time in 2012, a new personal record.

Here’s the sequence of events:

Wednesday morning I received an email alert from a company I use that my automatic monthly payment was declined.  Knowing full well it wasn’t a balance issue I assumed correctly that my bank had cancelled the card.  As I travel extensively and rely on the card exclusively I made my way to a local branch later that morning.  Along the way I called into the service center and confirmed my suspicions, that Visa informed the bank that my card was part of a range of numbers that was possibly exposed via a breach.  I asked if it was possible to learn the name of the offending vendor and was told (same as last time) that Visa doesn’t share that information.  As I am now a two-time victim it’s easy to spot the trend and hard to ignore the possibility that it might have involved the same vendor both times.  It wound up taking three visits to a branch to straighten me out and actually get a functioning card in my wallet.  The inconvenience is more than benign as I use the card in several places and will now need to make manual, one-off payments with the temporary card while awaiting the permanent card so that I can update the affected accounts.  By the time this is all said and done it will have resulted in my exhausting more than a half day of billable time trying to fix a problem I didn’t create.

A few things need to change.

  • First, as part of the breach notification the card issuer needs to share with the cardholder the source of said breach.  I’ve been hit twice in six months, there’s a better than even chance that it involved the same vendor and/or processor and I deserve to know if that’s true.
  • Second, affected cardholders should receive status updates providing details about the breach including the suspected source, the techniques potentially used and a description of any follow-up actions including investigative and (hopefully) criminal prosecution.
  • Third, issuers need to have a better system in place to address breaches.  The fact that I have to overtly take action in order to replace the card is a joke.  I’m a billable resource and taking time out to wait to talk to a customer service representative results in loss of income; I’m being punished twice as a result.  I should have been offered the option to have a card overnighted to me or have been able to receive a card at any teller window and have it activated right there and then (I had to first activate at an ATM before I could use the temporary plastic).  The card replacement process needs to be streamlined.

We collectively as an industry and a society need to accept that both identity and card theft is a mainstream occurrence and adjust accordingly.  Legislation is needed to further insulate the victims (like me) from any extended damage or inconvenience and ensure as smooth a process as possible to allow us to continue living our lives.  Because right now I don’t just feel like a victim, I feel like I’m being punished for being one and treated like I simply don’t matter.

Hey Washington, make the industry tell us what’s going on and to treat the consumers better!

Oh, and PCI Security Standards Council, how’s that framework working out for you?  I’m thinking the only one benefiting from your content are the practitioners making money by supporting it.

Seriously, something needs to change.

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  • David Schneier
    One more quick update to this story:Last night while using the temporary card my bank flagged the activity as unusual and suspended it.  For those of you keeping score that's the second time in five days and third time in six months.  When I visited yet another branch this AM I was told that my spending habits are reset for each unique card and so they have to reassess me every time.  Considering I used the card in four states over two days it was a sure fire bet to be flagged.You just can't make this stuff up.
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