Guarantee Secure Credit Transactions Before you Swipe that Card
By Bob Carr Chairman & CEO, Heartland Payment Systems | October 28, 2008
There's no denying that credit card fraud is on the rise. A 2007 report from the Association for Payments Professionals found 72 percent of 3,000 members surveyed had been victims of actual or attempted fraud in 2006. That's up from 68 percent in 2005.
Unfortunately, 80 percent of data compromises originate through small merchants-those generating less than 20,000 e-commerce transactions or a million total transactions annually-according to Visa USA.
These smaller merchants - such as independently owned hotels -- don't always have the technology to provide the secure systems needed in today's increasingly risky financial world. Worse, many hotel owners dismiss the problem because they think they are protected by their merchant acquirers. But they are not.
Indeed, as payment technology becomes more sophisticated, so do hackers' and thieves' methods for stealing sensitive information. And the results can be disastrous for any business, regardless of size.
For example, Massachusetts-based TJX Companies Inc., the world's leading off-price apparel and home fashions retailer, experienced a major customer credit and debit card data breach last January. It turned out to be the most expensive cybercrime ever recorded, with over 45.6 million customer credit and debit card numbers stolen.
Besides $150 million in breach costs, the company now faces FTC investigations, over a dozen lawsuits, with some litigation seeking tens of millions of dollars in damages. Analysts project the breach could ultimately cost TJX anywhere from $500 million to nearly $1 billion in expenses.