Back in the New World
Posted in Company News, Security on March 30th, 2010 by Robin – Be the first to commentWell, I am finally back in Minneapolis with no scheduled plans for travel until COMMON at the beginning of May. Of course, that can change at a moment’s notice so if you need any security services, let me know. Have bag; will travel!
I’d like to give a “Thank You” to Jill Martin for updating us here last week about her activities while I took a couple of (almost) vacation days in and around London with my children. What a spectacularly intense city that is! There is so much culture and history shoe-horned into a fairly small geographical space, and when you add in the vast population of commuters and visitors, you could be excused for becoming totally overwhelmed. One of the keys to a successful visit to London is understanding the incredible public transportation systems, and to not run yourself ragged trying to accomplish too much. (Easier said than done!)
From a professional perspective, it was a very successful trip. Although phones and e-mail are quick, cheap, and efficient methods of communication, there is something irreplaceable about an old-fashioned, face-to-face meeting and a firm handshake. Spending time with the Help/Systems International sales teams from the UK, France, and Switzerland was very enlightening, as we discussed and compared the security requirements of IBM i customers in the United States and Europe. I also ran through the PowerTech security information with the technical support team prior to a customer workshop in Farnborough. We had to move the event due to more registered attendees than seats in the Help/Systems office, and it was a fantastic four hours that flew by as we covered everything from user profile configuration to system values, to best practices for object authority configuration.
Since last visiting the U.K., one of the things that was noticeably different for me was how credit and debit retail transactions are now entirely “chip-and-PIN” based. If you are reading this from the U.S., you may have no idea what I am talking about—just as I had no idea until I got there. There are two main challenges with credit cards transactions at the point of sale using the more traditional “swipe and sign” technique:
- Determining that the physical card is not a counterfeit. The availability of swipe devices that read all of the data from a card’s magnetic strip means that it is not difficult to manufacture cards that appear to be completely legitimate, and that swipe with all of the information of a genuine card.
- Verifying that the card user is the actual owner of the card. This is normally accomplished by comparing the signature of the user with some form of formal identification such as a driver’s license. Unfortunately, this puts the responsibility of identity verification on the shoulders of the retail organization, instead of with the card user. Comparing a (commonly out-of-date) photo to a person’s physical likeness slows down transactions, and is fraught with human error. In my U.S. travel experience, it is rare for a sales clerk to even check the signature. Although it is against most cardholder agreements, I often write “Ask for ID” on the signature panel of my cards, and that does seem to help prompt a clerk to check my credentials. Unfortunately, if they “catch” a person trying to use someone else’s card, I have witnessed people successfully justifying it to the clerk.
By the end of 2006, U.K. retailers joined the initiatives of several other European nations and fully adopted a new point-of-sale mechanism that uses so-called smart cards, more commonly referred to “chip-and-PIN” cards. These cards, which look like regular credit cards, contain a small micro-chip that is read by a special reader device that looks similar to any other credit card processing machine but allows the card to be inserted. The embedded chip helps authenticate the card, thereby addressing the first challenge above. The requirement for a personal PIN to be entered instead of a traditional signature solves the second challenge, as the assumption is that your PIN number is highly confidential.
Use of smart-cards provides a couple of additional advantages over traditional signature transactions. First, most of the readers are portable devices, so the entire transaction can be handled without having to hand over your credit card to a complete stranger, as is common in the United States. Second, disabled users can now more easily use credit cards even when signatures are difficult or impossible.
While countries that use smart cards report significant declines in credit card fraud, there are currently a few disadvantages to this technology—especially for foreign travelers. Card numbers from PIN-based cards are being used fraudulently more easily in non-PIN countries, as no PIN is required. While most locations still have the capability to swipe cards from chipless cards, this becomes more difficult with unattended point-of-sale devices such as ticket machines and, from my own personal experience, clerks that are not particularly well-trained on processing a transaction using a chip-less card. Naturally, as additional countries adopt the smart card technology, these challenges will become less and less of an issue.
Upon my return last week, I began to research why this type of technology is not currently in-use in the United States. I was surprised to learn that it appears to be based purely upon the massive cost of replacing every point-of-sale terminal in comparison with the relatively low cost of credit card fraud here. However, as more and more countries adopt this technology, it will place pressure onto the U.S. to adopt it as well. I personally think that it would be a huge step forward in getting control of international credit card fraud.
Before I wrap up for this week, I would like to thank everyone that sent me 40th birthday wishes, and also to my Minneapolis cohorts—I mean colleagues—that “decorated” my office in black prior to my return. Payback is a …. Well, you know the expression!
Regards,
- rt


Finally, I am taking a couple of days off at the beginning of next week to enjoy a little time with my UK-based family, and to show my kids more of “the old country.” I will be back in Minneapolis later in the week.
After the session, I followed the recommendation of one of the session attendees and took a short drive to the Columbia River Gorge. Even though the light was beginning to fail, I was able to capture some memorable images of the impressive Multnomah Falls, a combination of two water falls with a combined height of 611ft, more than three times the height of the Niagara Falls that I visited last month.
Robin Tatam is the Director of Security Technologies for
Jill Martin