Life used to move slowly.
We raked our leaves, cooked our supper, dialed our telephones and shopped along Main Street.
Today, we blow our leaves, microwave our dinner, text our friends and click to add to our shopping cart. Convenience trumps deliberation. And we still have time to scan the Facebook news feed.
But consumers need to realize they’re trading security for efficiency and creating a world in which we risk treading thoughtlessly into the ruthlessly cast net of both far-flung cybercriminals and electronic pickpockets brushing past us at the mall.
Credit cards, in particular, pose a unique and complex threat to Americans of all stripes.
Whether you’re a thrifty shopper making every dollar count for your family or a globe-trotting mogul swiping your American Express Platinum at swank steak houses in Tokyo and boutique hotels in San Francisco, we are equally threatened by the proliferation of fraud.
I’m here to alert you that some of our conveniences are driving us into a world in which criminals every bit as digitally resourceful as the software engineers behind your smartphone are robbing us while we shop, eat, travel and even sleep.
I’m urging consumers to pressure retailers, banks and credit card issuers to collaborate on three main points to improve our collective security. The remainder of this call to action for consumers will help explain why these changes must be addressed urgently.
First, we desperately need a new point of sale system that increases security while not burdening small businesses with unduly high implementation costs. There’s talk of adopting a chip and pin system akin to what Europeans have been using for nearly a decade.
That’s a step in the right direction, and I applaud banks and credit card companies for finally realizing our current point of sale system largely fails consumers. But it’s unfortunate it took a massive breach like what we witnessed at Target retail stores during the holiday season to breathe life into this longstanding security failure.
Second, credit card companies, and banks, should be more proactive in educating the public on the dangers of RFID-enabled credit cards. RFID — short for radio frequency identification — is the use of electromagnetic fields to transfer data and is growing more ubiquitous by the day.
Governments use it to track goods and people, veterinarians implant them in our pets to track our wayward four-legged friends, and manufacturers have leveraged it to track products through the manufacturing process.
Used wisely, they bring fantastic new levels of security and fidelity to our lives.
But I’m willing to bet most readers are unaware there’s a similar chip implanted in the credit card you’re carrying now.
Why? So our lives can become even more convenient, tapping our cards along a space age point of sale device rather than, alas, taking the five extra seconds to run the magnetic strip through a reader.
But devious criminals have invented tools to swipe your card’s data emitted by the RFID antennae, simply by walking by you in busy mall or transit station.
This may surprise you, but not your card issuer. Language from patent applications filed on behalf of Visa acknowledged the threat of “skimming” for data from RFID cards. And that was in 2006.
My firm, Identity Stronghold, has dubbed it “electronic pickpocketing,” and we are urging people to educate themselves so they can protect their finances and identities from the nefariously savvy villains in our midst.
Third, if the Target breach and dozens of lesser reported episodes like it have taught us anything, it’s that retailers must invest in stronger back-end security to protect consumers long after they’ve left the store or powered off their laptop.
During a recent congressional hearing to investigate the massive breach of financial data at Target and Neiman-Marcus, federal law enforcement agents described “illicit digital marketplaces” run by dodgy Russian cybercriminals operating across Eastern Europe.
That’s hardly definitive, and provides less comfort than the maps generated by local law enforcement listing the addresses of convicted sex offenders living in your neighborhood. After all, we know what language the sex offenders speak, where they live and who they’re after, just not how to stop them ahead of the next crime. We know none of these facts about anonymous electronic pickpockets.
With an ailing economy, global insecurity and elections just over the horizon, why is Congress busy dragging retail executives to Capitol Hill?
The Target episode impacted 110 million customers during the height of the holiday shopping season. That’s more than one-third of the U.S. population.
So what’s a consumer to do?
Some people hoard gold. And if the financial apocalypse strikes, their bullion may prove valuable.
Some call for a retreat into cash transactions, boasting you can’t hack Benjamin Franklin’s thoughtful muse. But carrying wads of cash is dangerous, and regular trips to the ATM are difficult to justify.
The credit card companies say they have plans to protect us.
But these are the same people and the same firms who’ve left us so vulnerable to begin with. They may run slick advertising campaigns touting their zero-liability policies, and continue to entice consumers with reward cards, but don’t confuse cosmetics for surgery.
I take solace in a recent move by First American Bank following a massive wave of fraudulent debit card charges allegedly linked to Chicago area taxis.
After allegedly trying to collaborate with MasterCard and Bank of America, the Chicago area bank publicly admonished two of the nation’s largest and most powerful companies.
“These companies appear to not have stopped the breach,” First American Bank said in a statement.
This public spat is symptom of a disease growing stronger, broader and more difficult to treat.
We are at a pivotal point in our financial history. The economy is clearly improving, manufacturing is expanding, people are traveling and small businesses are hiring.
However, we risk undermining our slow but steady climb out of the financial abyss created by the Wall Street fiasco of 2008 if we don’t fundamentally address the raft of weaknesses in our payment system.
I hope you’ll join me in demanding solutions from policy makers and executives who, up to now, have not been up to the challenge threatening us all.
Walt Augustinowicz is a radio frequency identification (RFID) expert, consumer advocate and founder of Identity Stronghold. He resides in Sarasota, where he also continues to develop proprietary technologies for consumers and government employees.