Tightening up credit card security on restaurants
The credit card industry came down hard on tens of thousands of restaurants that have not sufficiently protected diners’ credit card data from potential theft, with Visa, MasterCard and financial organizations that process electronic payment over recent months sending warnings letters and holding seminars. With these moves, it forces restaurants to take more action when it comes to protecting their diners’ credit card info.
For the companies that process card transactions, tens of thousands of eateries are not complying with credit card industry security rules. Any company that takes plastic is required to follow a set of security regulations instituted by Visa, MasterCard, American Express and Discover.
With the data recorded by Visa indicates that since January of 2005, around 40% of incidents in which criminals gained unauthorized access to credit card information was made up of restaurants — accounting for the largest percentage of incidents for a merchant category.
Separately, AmbironTrustWave, a Chicago-based data security auditor for merchants, reported that 62 percent of the security violations it witnessed during the prior 18 months occurred in the restaurant industry.
The violations involved different kinds of security lapses such as poor guarding of wireless networks — which enable thieves to access information from the parking lot using a laptop — and lax systems that makes it a lot easier for a staff with criminal intention to steal credit card data.
Oftentimes, consumers have no clue when their credit card information is in danger. Not all security breaches produced successful fraud, and most merchants do not acknowledge these incidents unless there’s a significant probability that a major fraud has already been identified or about to take place. Furthermore, credit card issuers usually do not close a customer’s account unless fraud has taken place.
Restaurant owners may have a rough time with credit card security rules, since its regulations can be very difficult for small sized businesses. The National Restaurant Association trade group says that it hears from restaurant owners who thought they complied with rules, but found out their systems were not functioning properly and were penalized.
Over 0,000, in some cases, is the fine for restaurants that violated credit card industry rules by keeping credit card information. In 2006, Visa fined merchants across all categories .6 million for security violations, an increase from the .4 million in fines the previous year.
Visa, believes a merchant group needs additional attention, held special security briefings with several hundred restaurants.
At the same time, the companies that process credit cards have also turned the heat on restaurants. These credit card companiesthreatened those who do not follow security regulations that they will end their services.
Credit card companies are especially worried about specialized software restaurants use, which combine such features as tabulating bills, delivering orders to the kitchen and tracking reservations. Since credit card companies cannot require software makers to abide by their security rules, they instead apply pressure to restaurants. Visa maintains a list on its Web site of software programs that meet its requirements.
But software makers that even with the best software, restaurants could still be in heaps of trouble if they disregard password protection or firewalls. Software companies say it is not up to them to let restaurateurs know what they must do to be in compliance with credit card rules.
The author of this article writes for POS-For-Restaurants.com, a VP of Customer Relations with over 20 years experience in restaurant point of sale system, helping restaurant owners nationwide increase their efficiency and bottom-line profits.
To learn on how our national POS network of restaurant point of sale experts can help your business achieve greater success in these difficult economic times, visit POS-For-Restaurants.com.
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