Category Archives: industry news

credit card processing and merchant payment industry news including VISA & MasterCard association news, interchange rates, risk management and retailer security requirements

FRAUDSTERS TARGETING CALL CENTER CHAT AND NON-VOICE CHANNELS

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Visa Security Alert to the risk of online chat solutions and non-voice channel services within call centers and merchant online environments, which are expected to increase along with artificial intelligence. There are known instances where threat actors compromised online chat service providers and were able to distribute malware to merchant clients designed to intercept payment card data during checkout.

Read the story here in the Visa library for merchants. https://usa.visa.com/support/merchant/library.html

The Visa alert also points out the importance of verifying your technology partners are secure and compliant. This is especially interesting in the context of this article.

The Visa Global Registry of Service Providers is Visa’s designated source for information on registered and PCI DSS-validated agents that provide payment-related services to Visa clients and merchants. Service providers that store, process or transmit Visa payment data must be registered with Visa and demonstrate PCI DSS compliance. All of the links in this article can be found on the merchant rules and  PCI compliance links

Christine Speedy, CenPOS Global Sales, 954-942-0483 is a PCI Council QIR certified professional based out of South Florida, near Fort Lauderdale, and Rochester, NY.

IBM Study: Hidden Costs of Data Breaches Increase Expenses for Businesses

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Study for First Time Calculates the Full Cost of “Mega Breaches,” as High as $350 Million

CAMBRIDGE, Mass., July 11, 2018 /PRNewswire/ — IBM (NYSE: IBM) Security today announced the results of a global study examining the full financial impact of a data breach on a company’s bottom line. Overall, the study found that hidden costs in data breaches – such as lost business, negative impact on reputation and employee time spent on recovery – are difficult and expensive to manage. For example, the study found that one-third of the cost of “mega breaches” (over 1 million lost records) were derived from lost business.

Sponsored by IBM Security and conducted by Ponemon Institute, the 2018 Cost of a Data Breach Study1 found that the average cost of a data breach globally is $3.86 million,2 a 6.4 percent increase from the 2017 report. Based on in-depth interviews with nearly 500 companies that experienced a data breach, the study analyzes hundreds of cost factors surrounding a breach, from technical investigations and recovery, to notifications, legal and regulatory activities, and cost of lost business and reputation.

  • IBM-Security-Data-Breach-Calculator-2018

This year for the first time, the study also calculated the costs associated with “mega breaches” ranging from 1 million to 50 million records lost, projecting that these breaches cost companies between $40 million and $350 million respectively.

“While highly publicized data breaches often report losses in the millions, these numbers are highly variable and often focused on a few specific costs which are easily quantified,” said Wendi Whitmore, Global Lead for IBM X-Force Incident Response and Intelligence Services (IRIS). “The truth is there are many hidden expenses which must be taken into account, such as reputational damage, customer turnover, and operational costs. Knowing where the costs lie, and how to reduce them, can help companies invest their resources more strategically and lower the huge financial risks at stake.”

Hidden Figures – Calculating the Cost of a Mega Breach
In the past five years, the amount of mega breaches (breaches of more than 1 million records) has nearly doubled – from just nine mega breaches in 2013, to 16 mega breaches in 2017.3 Due to the small amount of mega breaches in the past, the Cost of a Data Breach study historically analyzed data breaches of around 2,500 to 100,000 lost records.

Based on analysis of 11 companies experiencing a mega breach over the past two years, this year’s report uses statistical modelling to project the cost of breaches ranging from 1 million to 50 million compromised records.  Key findings include:

  • Average cost of a data breach of 1 million compromised records is nearly $40 million dollars
  • At 50 million records, estimated total cost of a breach is $350 million dollars
  • The vast majority of these breaches (10 out of 11) stemmed from malicious and criminal attacks (as opposed to system glitches or human error)
  • The average time to detect and contain a mega breach was 365 days – almost 100 days longer than a smaller scale breach (266 days)

For mega breaches, the biggest expense category was costs associated with lost business, which was estimated at nearly $118 million for breaches of 50 million records – almost a third of the total cost of a breach this size. IBM analyzed the publicly reported costs of several high profile mega breaches, and found the reported numbers are often less than the average cost found in the study.4 This is likely due to publicly reported cost often being limited to direct costs, such as technology and services to recover from the breach, legal and regulatory fees, and reparations to customers.

What Impacts the Average Cost of a Data Breach?
For the past 13 years, the Ponemon Institute has examined the cost associated with data breaches of less than 100,000 records, finding that the costs have steadily risen over the course of the study.  The average cost of a data breach was $3.86 million in the 2018 study, compared to $3.50 million in 2014 – representing nearly 10 percent net increase over the past 5 years of the study.

The study also examines factors which increase or decrease the cost of the breach, finding that costs are heavily impacted by the amount of time spent containing a data breach, as well as investments in technologies that speed response time.

  • The average time to identify a data breach in the study was 197 days, and the average time to contain a data breach once identified was 69 days.
  • Companies who contained a breach in less than 30 days saved over $1 million compared to those that took more than 30 days ($3.09 million vs. $4.25 million average total)

The amount of lost or stolen records also impacts the cost of a breach, costing $148 per lost or stolen record on average. The study examined several factors which increase or decrease this cost:

  • Having an incident response team was the top cost saving factor, reducing the cost by $14 per compromised record
  • The use of an AI platform for cybersecurity reduced the cost by $8 per lost or stolen record
  • Companies that indicated a “rush to notify” had a higher cost by $5 per lost or stolen record

This year for the first time, the report examined the effect of security automation tools which use artificial intelligence, machine learning, analytics and orchestration to augment or replace human intervention in the identification and containment of a breach. The analysis found that organizations that had extensively deployed automated security technologies saved over $1.5 million on the total cost of a breach ($2.88 million, compared to $4.43 million for those who had not deployed security automation.)

Regional and Industry Differences
The study also compared the cost of data breaches in different industries and regions, finding that data breaches are the costliest in the U.S. and the Middle East, and least costly in Brazil and India.

  • U.S. companies experienced the highest average cost of a breach at $7.91 million, followed by the Middle East at $5.31 million.
  • Lowest total cost of a breach was $1.24 million in Brazil, followed by $1.77 million in India.

One major factor impacting the cost of a data breach in the U.S. was the reported cost of lost business, which was $4.2 million – more than the total average cost of a breach globally, and more than double the amount of “lost business costs” compared to any other region surveyed. One major factor impacting lost business costs is customer turnover in the aftermath of a breach; in fact a recent IBM / Harris poll report found that 75 percent of consumers in the U.S. say that they will not do business with companies that they do not trust to protect their data.

For the 8th year in a row, Healthcare organizations had the highest costs associated with data breaches – costing them $408 per lost or stolen record – nearly three times higher than the cross-industry average ($148).

“The goal of our research is to demonstrate the value of good data protection practices, and the factors that make a tangible difference in what a company pays to resolve a data breach,” said Dr. Larry Ponemon, chairman and founder of Ponemon Institute. “While data breach costs have been rising steadily over the history of the study, we see positive signs of cost savings through the use of newer technologies as well as proper planning for incident response, which can significantly reduce these costs.”

Download Full Reports & Register for the Webinar
To download the 2018 Cost of a Data Breach Study: Global Overview, visit https://www.ibm.com/security/data-breach/

To view the digital infographic with study highlights, visit: https://costofadatabreach.mybluemix.net

To register to attend the IBM Security and Ponemon Institute webinar on July 26th at 11 a.m. ET, visit: https://ibm.biz/BdYDvf

About IBM Security
IBM Security offers one of the most advanced and integrated portfolios of enterprise security products and services. The portfolio, supported by world-renowned IBM X-Force® research, enables organizations to effectively manage risk and defend against emerging threats. IBM operates one of the world’s broadest security research, development and delivery organizations, monitors 35 billion security events per day in more than 130 countries, and has been granted more than 8,000 security patents worldwide. For more information, please check www.ibm.com/security, follow IBMSecurity on Twitter or visit the IBM Security Intelligence blog.

Media Contact:
Cassy Lalan
IBM Security Communications
319-230-2232
cllalan@us.ibm.com

1 Data collection began February 2017 and interviews were completed in April 2018
2 Average cost for data breaches of 2,500-100,000 lost or stolen records
3 Source: IBM analysis of Privacy Rights Clearinghouse’s Chronology of Data Breaches
4 Equifax data breach reported to cost company $275 million; Target 2016 financial report estimated $292 million loss as a result of 2013 data breach; Ruby Corp (the parent company of Ashley Madison) reportedly paid $11.2 million for the settlement of its 2015 breach.

 

SOURCE IBM

Why does my web site need SSL security 2018

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Every web site needs SSL in 2018 to avoid web site insecure messages that scare away visitors.

Disabling TLS 1.1 and lower is recommended for all businesses. While web site security with SSL is commonly considered only necessary if accepting payments or using secure online forms, that’s no longer the case. It can impact Google listings, overall SEO, and whether visitors see your web site.

SSL secured web sites for years. Even though tech people still call it SSL, the next phase of ecommerce security was TLS. TLS 1.1 and lower, including SSL 1.0, are not considered secure. For that reason, all businesses accepting payments online must have disabled TLS 1.1 and lower on their servers for mandatory Payment Card Industry Data Security Standards  (PCI) compliance by June 30, 2018. Additionally, buyers with outdated browsers may be blocked from making purchases if not supporting the latest security standards.

If your web site does not have an SSL certificate, visitors will get a browser message, which may vary by browser, telling them your web site is not secure and that any information submitted could be viewed by others.

connection not secure message

Web browser warnings like this will scare away visitors.

FREE Test SSL/TLS for Browser and Servers:

Server penetration testing falls under the Computer Fraud and Abuse Act (CFAA) (18 U.S.C. 1030). It’s a federal crime to “intentionally access a computer without authorization or exceed authorized access”. If it’s not your web site, and you don’t have explicit permission to access, don’t run a server test. If you do have the right to run it, be sure to check the box, HIDE RESULTS. If you get a YES next to TLS 1.0, SSL 3, or SSL 2 on the server test, then hardening is needed. To modify your web site, it’s managed in host administration and disable in security settings. Free SSL and TLS test from Qualys. https://www.ssllabs.com/ssltest/index.html.

Godaddy gives a very good overview of options. https://www.godaddy.com/web-security/ssl-certificate#compare. I recommend getting the Extended Validation (EV) SSL for the value-added benefits.

Headquartered in Miami, Florida, CenPOS is reshaping the future of commerce through technology innovation and the secure, flexible and simple solutions this enables. Christine Speedy, CenPOS Global Sales, 954-942-0483 has extensive ecommerce experience dating back to the early internet days and can assist with any questions.

Equipment Rental Credit Card Processing Rules Change

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Bobcat, Caterpillar, and other companies that offer rental equipment, all are impacted by new credit card processing rules for rentals. equipment rentals credit card processing

While businesses expect their software, including ERP, Point of Sale, and ecommerce shopping carts to help them manage compliance with credit card acceptance rules, the reality is that many don’t. Compliance increases profits; non-compliance increases new chargeback risks, interchange fees, penalty fees and authorization declines.

Traditional desktop terminals don’t support the new transaction data requirements. If merchant is not using EMV chip device, now is the time to upgrade to a cloud-based solution and fix two problems at once. Rental merchants cannot meet both card acceptance and Payment Card Industry Data Security Standards compliance requirements using traditional paper credit card authorization forms. Cloud technology and a compliant payment gateway are needed. For example, pair the Verifone MX 915 with the CenPOS validated Point to Point Encryption (P2PE) solution and use either a standalone or integrated to ERP such as Microsoft Dynamics AX.

Key elements for compliance:

  • Initial authorization transaction must send new transaction indicator that it’s an estimate; the final amount could change for example because the renter kept it longer or damaged the equipment. This is technically managed by the payment gateway.
  • If applicable, send incremental authorizations with related indicator.
  • If storing the card, the Visa Stored Credential mandate outlines the specific requirements for agreement with customer, cardholder authentication, and procedures to use a stored card on file. For example, perform cardholder authentication with either security code or 3-D Secure. 3-D Secure can only be invoked if the customer self-pays; it shifts friendly fraud liability to the issuer and merchants can also qualify some cards for even lower interchange rates.
  • Update language in agreements for opt-in to terms and conditions as required by Visa.

Card issuers and acquirers were mandated to be compliant in 2017, and merchants by October 2017, however, there’s no mandate for payment gateways. Even if an existing payment gateway supports the new requirements, merchants must make changes. Visa is the most complex, however other brands have similar rules.

From tokenization to Express Checkout, CenPOS creates a seamless commerce experience throughout the enterprise. Innovations, including Express Checkout via text or email, help businesses maximize profit in all departments. CenPOS takes the heavy lifting out of payment acceptance offering a range of solutions that simplify every aspect of implementing, operating and maintaining a payment system enabling merchants to focus on their business. CenPOS Express Checkout via text or email includes 3-D Secure capability as part of a layered security approach.

CenPOS is an integrated commerce technology platform driving innovative, omnichannel solutions tailored to meet a merchant’s market needs. Providing a single point of integration, the CenPOS platform combines payment, commerce and value-added functionality enabling merchants to transform their commerce experience, eliminate the need to manage complex integrations, reduce the burden of accepting payments and create deeper customer relationships. Powered by its enterprise-class, end-to-end transaction engine, CenPOS’ secure, cloud-based solutions seamlessly integrate with a merchants existing infrastructure minimizing disruption and saving time and money. Committed to a merchant-centric approach CenPOS provides a one-to-one level of service and support, enabling merchants to focus on their core business.

Headquartered in Miami, Florida, CenPOS is reshaping the future of commerce through technology innovation and the secure, flexible and simple solutions this enables. Christine Speedy, CenPOS Global Sales, 954-942-0483.

Reference:

https://usa.visa.com/dam/VCOM/global/support-legal/documents/stored-credential-transaction-framework-vbs-10-may-17.pdf

See also core rules, especially section 5 https://usa.visa.com/dam/VCOM/download/about-visa/visa-rules-public.pdf

Are You Compliant? B2B Credit Card Processing Fact Check

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Merchant compliance with various credit card processing rules maximizes profits while mitigating risk. This is especially true for business to business companies. But that task is getting harder and harder with the onslaught of new rules, and virtually impossible if not using a sophisticated cloud solution to help manage compliance.

b2b visa stored credentialIf your B2B company stores credit cards, there’s a pretty good chance you’re not compliant. For example, Visa’s 2017 Stored Credential Transaction framework (PDF download from Visa) outlines merchant responsibilities to obtain customer consent as well as storing credit cards, using stored credentials (token), and managing stored tokens. Failure to comply with Authorization rules, for example preauthorization and final settlement do not match, has far-reaching consequences including higher interchange rates (the bulk of credit card processing fees), penalty fees and new chargeback risks. With so many new rules across multiple card brands that vary based on business and transaction type how can a business quickly ascertain if they’re compliant?

Quick tips to validate compliance:

  1. Is cardholder authentication performed when a new card is stored? When the cardholder data is entered and submitted, the issuer responds with an approval or declined message. A small charge is not an acceptable practice to submit transaction for approval; instead a zero dollar authorization request for authentication is submitted. If authentication is via 3-D Secure -Verified by Visa, MasterCard Secure Code, whereby the customer self-authenticates vs merchant initiating, reduced rates may apply. Under the new rules, two transactions occur at the time a card is stored. Compliant answer is yes.
  2. Is a transaction receipt delivered to customer when you store a credit card? This will be either for an amount or a zero dollar authorization. When stored credit card credential (token) is created, a transaction receipt is generated with the approval or decline and other mandatory fields. Compliant answer is yes.
  3. Does the receipt include “RECURRING” or “REPEAT SALE” for token transactions? Compliant answer is yes.
  4. Review merchant statements, usually the last 1-2 pages with the heading “pending interchange” or “fees” section. Do you see EIRF, STANDARD (STD), or DATA RATE I? Compliant answer is no.
  5. Can you produce documentation of customer consent to store their card (including with 3rd party service) and how it will be used?

If you’re not in compliance, your payment gateway is the most likely culprit, followed by ERP or other software integration limitation. I can fix that.

Reference: Links for all Card brands.

Need help getting compliant?

Call Christine Speedy, , for simple solutions to complex payment transaction problems, 954-942-0483, 9-5 ET. CenPOS authorized reseller based out of South Florida and NY. CenPOS is an integrated commerce technology platform driving innovative, omnichannel solutions tailored to meet a merchant’s market needs. Providing a single point of integration, the CenPOS platform combines payment, commerce and value-added functionality enabling merchants to transform their commerce experience, eliminate the need to manage complex integrations, reduce the burden of accepting payments and create deeper customer relationships.