This Week’s Payment & Digital Media News

EMV
What’s Holding Back Retailers From Adopting Chip And PIN In The U.S.? – www.retailtouchpoints.com – 7/17/12 – “green_capI heard recently that the adoption of chip and PIN technologies for credit and debit cards can cut fraud losses by 60%.  In Brazil, for example, almost 100% of cards have been converted to chip and PIN and counterfeit card fraud is practically nonexistent. The reduction of fraud can be attributed to embedded microchips in credit and debit cards.”

Amex to move to chip-based cards in U.S.– www.travelweekly.com – 7/12/12 – “American Express this year plans to begin issuing chip-based cards in the U.S. as part of a “roadmap to advance EMV chip-based contact, contactless and mobile payment for all merchants, processors and issuers” of its cards, according to the company.”

Mobile Payments
Why Mobile Wallets Need Social Media to Survive– www.paymentssource.com – 7/20/12 – “Developing a mobile wallet for consumers is one thing. Getting those consumers interested and educated about how the wallet works and why they should use phones for payments is an entirely different matter.”

The New CFPB Will Keep an Eye on Mobile Payments– digitaltransactions.net – 7/20/12 – “An official with the federal government’s new Consumer Financial Protection Bureau gave independent sales organizations and others in the merchant-acquiring industry a hint about what the controversial agency will be looking for as mobile payments take hold and technology advances all forms of electronic payments.”

Google Adds Mobile Wallet to Its New Tablet– wwww.paymentssource.comw. – 7/19/12 – “Google’s decision to add Google Wallet to its new Nexus 7 tablet could break the limitations its mobile payment system has faced in reaching consumers.”

Mass adoption of smartphones tipping point for explosion in mobile payments technology, says Deloitte – www.voiceanddata.com.au – 7/19/12 – “A new report, The future of exchanging value – Uncovering new ways of spending, by professional services firm Deloitte explores how conventional payments infrastructure is changing with the emergence of a new generation of payments solutions using technology to interact and transact with people.”

Isis mobile pay service may start trials in August– news.cnet.com – 7/19/12 – “The joint venture of Verizon, AT&T, and T-Mobile will launch with compatible Android and BlackBerry smartphones, as well as a sleeve that works with iPhones, CNET has learned.”

PayPal Points to More Mobile POS Rollouts, Projects $10 Billion for ’12 Mobile Volume– digitaltransactions.net – 7/19/12 – “PayPal Inc. on Wednesday said two more retail chains are rolling out PayPal acceptance in their stores. It also said its PayPal Here mobile-acceptance product, which it introduced in March, is now generally available to merchants in the U.S. and Hong Kong, markets where some 300,000 users have signed up on a waiting list for the service.”

JCPenney CEO Ron Johnson Wants To Eliminate The Person Standing At The Cash Register– www.businessinsider.com – 7/18/12 – “JCPenney CEO and former Apple retail guru Ron Johnson is speaking at Fortune’s Brainstorm Tech conference in Aspen, and he revealed a bit of what his strategy is for store checkout.”

Google Wallet Still Dogged by Security Concerns– www.americanbanker.com – 7/18/12 – “Mobile wallets are attracting a lot of the wrong kind of attention, from hackers, faux hackers, and business disputes that have security overtones — all suggesting that despite the best efforts of firms such as Google to shore up defenses, the contactless payments safety issue is a shadow that won’t go away.”

Merchants Will Drive Mobile Payment Ignition, Says NPCA CEO – pymnts.com – 7/18/12 – “Joe Randazza, CEO of the National Payment Card Association, thinks some people are missing the point in the conversation about mobile payments.”

Commonwealth bank to revolutionise the point-of-sale experience– www.commbank.com.au – 7/17/12 – “Commonwealth Bank today unveiled the future of point-of-sale (POS) payments, powered by a new software platform, applications, and a new omni-commerce device that will redefine the POS experience for businesses and consumers.  The announcements are the result of a significant investment in breakthrough design and engineering that address the complex security needs of POS while unleashing opportunity afforded by tablets and industry-standard  platforms to deliver new innovations to consumers.”

Isis Offers Mobile Wallet Preview Before Launch– www.mybanktracker.com – 7/13/12 – “The biggest rival to Google Wallet is preparing for its upcoming launch. With the release of a set of tutorial videos on Thursday, Isis reveals more details on the mobile wallet’s user experience and how it plans to compete in the fast-growing market of mobile payments.”

Mobile Payments vs. Payments While Mobile– www.mediapost.com – 7/11/12 – “There’s been a lot of talk for a long time about mobile payments.  Generally, however, the discussions focus on the actual paying of something on location using a mobile phone.”

UK Mobile Wallet Could Get Summer Go-Ahead– pymnts.com – 7/10/12 – “The mobile operators behind a new digital wallet platform for the U.K. are preparing for launch, and may receive necessary regulatory approval as soon as this summer.”

Inside Apple’s Go-Slow Approach to Mobile Payments – online.wsj.com – 7/6/12 – “AAPL -0.51% often bides its time before diving in to developing tech markets, which explains why it’s largely on the sidelines in the mobile-payment wars.”

Disney Store POS Rollout Boosts Sales 25% at Upgraded Sites– risnews.edgl.com – 7/1/12 – “The rollout of a new point-of-sale system integrated with iPod Touch devices for store associates was the centerpiece of a major technology upgrade/remodeling initiative at 320 Disney Store locations. Customer traffic in the remodeled stores has increased 20% and sales have climbed 25%, according to Ron Johnson, director of technology for Disney Stores.”

Mobile Point of Sale
Retailers Look to Mobile Point-of-Sale Tools– www.emarketer.com – 7/16/12 – “Nearly one in four retailers has already deployed POS, and the same number plan to do so in the next 12 months.”

NFC
Does iTravel Patent Mean An NFC iPhone Is Next?– www.paymentssource.com – 7/13/12 – “If Apple Inc. doesn’t include Near Field Communication technology in its next generation of iPhone this fall, the company sure has a stockpile of NFC patents to use at a later date.”

China Mobile preps NFC payments phone– www.nfcworld.com – 7/11/12 – “The world’s largest mobile network operator has completed development of a China Mobile Wallet running on an NFC version of the Coolpad 8870 smartphone and will begin shipping the device in the third quarter of 2012.”

Can clouds and contactless chips coexist?– portalsandrails.frbatlanta.org – 7/9/12 – “Mobile wallets have started to make their way into the market this year. Inevitably, industry stakeholders are joining opposing camps on the technology that these wallets use to keep payment information and other personal data safe and secure: contactless chips or cloud-based technology. The chips are embedded in a mobile handset that communicates with a terminal via near field communication (NFC), while the cloud-based technology involves an application downloaded to the mobile handset.”

Payment Trends

The Interchange Settlement: Cards Won– storefrontbacktalk.com – 7/18/12 – “The major interchange fee settlement deal between Visa, MasterCard and various retailers and other industry players was huge, in that it was the result of the big showdown retailers have awaited for years. Winner: card brands. It’s not hard to judge the winner of such an event, simply look at the statements both sides issued afterwards.”

Merchants Considering Credit Card Surcharges– www.nytimes.com – 7/16/12 – “Starting this week, prices are 2 percent lower on ScanMyPhotos.com. At the grocer Kroger, executives are contemplating charging two prices for groceries — a lower price when shoppers pay with cash, and a higher one when they use a credit card. And at restaurants across the country, owners are weighing the wisdom — or lack of it — of a surcharge on bills paid with credit cards.”

Random Thoughts: Settlement, NFC and CLO – tomnoyes.wordpress.com – 7/16/12 – “As most of you have read a $7.25B settlement was reached with some US retailers (led by Kroger, Safeway, Payless, Rite-Aid). I’m not going into depth on the settlement but rather the likely response by retailers, and potential impact on Visa/MA earnings.  The big retailers have been assuming that this settlement would be reached and have been in the midst of a plan. What would you do if someone was taking 3% of your sales and your average profit margin was 2.4% (ref page Aii IMAP Study)?”

Merchants Reach $7.25B Interchange Settlement with Visa and MasterCard – www.paymentsnews.com – 7/13/12 – “MasterCard logo 140pxVisa logo 60pxh Visa and MasterCard have announced that they, and several major US issuers, have reached a $7.25 billion class-action settlement with US merchants. Visa’s statement is here; MasterCard’s statement is here. Specific terms of the agreement include:”

Visa, MasterCard Settlement: Credit Card Companies Agree To Pay $6 Billion Over Fee Fixing Claims – www.huffingtonpost.com – 7/13/12 – “Visa, MasterCard and major banks agreed to pay retailers at least $6 billion to settle a long-running lawsuit that alleged the card issuers conspired to fix the fees that stores pay to accept credit cards. As part of the settlement, announced late Friday, stores from Rite Aid to Kroger will be allowed to charge customers more if they pay using a credit card.”

NACS Rejects Visa, MasterCard Swipe Fee Settlement – www.csnews.com – 7/13/12 – “Visa and MasterCard and other financial institutions have reached a settlement in a swipe fee lawsuit dating back to 2005. However, NACS, the Association for Convenience and Fuel Retailing — a class plaintiff in the lawsuit — has rejected the settlement.”

The Future of Retail Technology– vsr.edgl.com – 7/9/12 – “The brick and mortar store is under attack. The economy is one reason, but so is a trend toward customers treating stores as showrooms where they can check out a product before buying it cheaper from online-only retailers—even via their mobile device while still standing on the store’s floor.”

The death of cash– tech.fortune.cnn.com – 7/9/12 – “Café Grumpy is the kind of hipster hangout that wouldn’t deign to trumpet itself. Tucked away on a quiet street in New York’s Chelsea neighborhood, it’s easy to miss. There’s no sign out front, just a frowning face stenciled on a large shop window. And yet when I walked in for the first time, I immediately felt like one of the regulars. “Charge it to Miguel,” I told the barista after ordering a cappuccino, and charge it he did — to my phone.”

Payment Security

Steakhouse stakeout caught scammers– www.thetelegraph.com – 7/22/12 – “The owner of Amarillo Tex’s wants his customers to know that the steakhouse has taken measures to prevent a repeat of the credit card scam perpetrated by two of his employees more than two years ago.”

BC Hydro asks customers to check bills after online security breach– vancouver.24hrs.ca – 7/20/12 – “BC Hydro is asking its online credit-card customers to check their bills after a security breach was detected last week.”

Dave & Buster’s Hacker Sentenced– www.bankinfosecurity.com – 7/19/12 – “Estonian hacker Aleksandr Suvorov has been sentenced to seven years in prison for his role in two hacking schemes that involved more than 240,000 stolen credit card numbers.”

Shell Gas Station Clerk Sentenced in Secret Service Case of ATM Card Skimming– blogs.ocweekly.com – 7/18/12 – “A Santa Ana Shell gas station employee working in this country on a special work visa from India has been sentenced following a U.S. Secret Service investigation that discovered he’d taken $50,000 to allow other criminals to plant ATM card skimming devices inside gas pumps.”

If Apple Can’t Stop One Fraudster, Can It Ever Challenge Visa?– storefrontbacktalk.com – 7/18/12 – “Apple’s status as the Great Fruit Hope for alternative payments took a hit this week, after it failed to stop a Russian hacker who broke the iPhone’s security for many in-app purchases. It’s roughly the equivalent of customers somehow tweaking their payment cards, and then swiping them at an in-store PIN pad, which tells the POS the transaction has gone through—except the card is never charged.”

Credit Card Skimming – A business and customer nightmare– www.fastcasual.com – 7/18/12 – “”Credit card skimming is an epidemic in quick service and fast casual restaurants as employees such as the one above are recruited or planted by organized crime rings. The primary targets for the collusion are low-wage employees that handle customer credit card transactions.”

Surveillance video catches credit card thieves– www.fox10tv.com – 7/17/12 – “When a Mobile woman got her credit card statement recently she received a nasty surprise: hundreds of dollars in fraudulent charges.  It’s a crime anyone can become a victim of. In this case, Daphne police have surveillance video and they’re looking for your help.”

Four million Ontario voters warned of ‘unprecedented’ privacy breach– www.winnipegfreepress.com – 7/17/12 – “Four million eligible voters in Ontario were put on alert Tuesday that their personal information may have been compromised in a major privacy breach at the province’s electoral office.  It’s an “unprecedented” breach of privacy in the province and possibly in Canada, said Ontario’s Privacy and Information Commissioner Ann Cavoukian.”

Card skimmer found on Auburn ATM – auburnjournal.com – 7/17/12 – “A card skimming device was found attached to an Auburn bank’s ATM machine Sunday afternoon, according to Detective Sergeant Dale Hutchins of the Auburn Police Department Monday.”

The Hanover Helps Agent Partners Bring Improved ID Theft Prevention And Recovery To Small Commercial Clients– www.dailymarkets.com – 7/17/12 – “The Hanover Insurance Group, Inc. (NYSE:THG), a leading provider of property and casualty insurance nationwide, today announced that it has broadened its partnership with IDentity Theft 911, a leader in identity management and data-breach response. As a result, The Hanover is now introducing coverages and services for ID theft prevention and mitigation services for small business clients that are not typically available in the market for businesses of that size.”

Why Apple’s app payment breach matters– www.telecomasia.net – 7/17/12 – “The web is awash with coverage of a Russian hacker’s apparent breach of Apple’s tight security surrounding app, and in-app, payments.”

Guilty Plea for Mag Mile, Wrigley Field Credit Card Skimmer– www.nbcchicago.com – 7/17/12 – “A Chicago man pleaded guilty Tuesday to organizing an ATM “skimming” ring that stole more than $200,000 from diners using bank or credit cards at restaurants and attractions across the city, including Wrigley Field.”

Card skimmer discovered– www.dumbartonreporter.co.uk – 7/16/12 – “Residents in Dumbarton and the Vale are being reminded to remain vigilant when using the area’s ATM machines.”

Yahoo Patches Vulnerability that Led to 450,000-Password Breach– threatpost.com – 7/13/12 – “Yahoo announced today it’s fixed the security hole that allowed a hacker group this week to post some 450,000 email addresses and passwords belonging to freelance writers.”

Rapper Arrested for Card Fraud– www.bankinfosecurity.com – 7/13/12 – “A California rap artist has been arrested for his alleged connection to an international carding fraud and point-of-sale hacking scheme that involved thousands of debit and credit accounts.”

Data: The Breach Is Only the Beginning– www3.cfo.com – 7/13/12 – “The theft yesterday of more than 450,000 user names and passwords from Yahoo also exposed the e-mail addresses and passwords of users of Gmail, AOL, Hotmail, Comcast, MSN, and several other e-mail services. In other words, if people subscribed to the breached Yahoo service with the same passwords they’ve used for their own e-mail accounts, then those passwords are now in the possession of the hacking group D33D Co. that breached Yahoo and posted those names and passwords online.”

Feds: Fraud totals nearly $300K at Comerica ATMs– www.wpxi.com – 7/13/12 – “Crooks have stolen nearly $300,000 by installing high-tech gadgets on Comerica Bank ATMs and gleaning personal information off customer cards, federal authorities said Friday.”

450,000 Yahoo accounts reportedly hacked, published online– www.scmagazine.com.au – 7/12/12 – “Up to 450,000 Yahoo! Voice account usernames and passwords have been stolen and published online.”

Couple accused of skimming at gas station– www.digtriad.com – 7/12/12 – “A California couple, Gohar Yesayan, 28, and Sarksis Mkhsyan, 29, is accused of implanting credit card skimmers in six gas pumps at a Shell station in New Hope, Minnesota.”

Card skimming devices may have been used at two Tesco cash machines in Scunthorpe say police– www.thisisscunthorpe.co.uk – 7/12/12 – “Scunthorpe police are warning the public to be vigilant following reports of possible card skimming at the cash machines outside the Tesco store on Gallagher Retail Park.”

Two men held in ATM scam– www.trinidadexpress.com – 7/11/12 – “Two men who have been described as being actively involved in the Automatic Teller Machines (ATM) skimming have been arrested by police and are assisting in further investigations.”

Stratfor aims to settle suit over data breach– www.statesman.com – 7/11/12 – “Attorneys involved with a class-action lawsuit against Austin’s Stratfor Inc. are circulating a proposed settlement to several hundred thousand former and current Stratfor customers and others affected by a data breach.”