reflections

Credit Card Solutions

We have become so used to credit card and debit card use that life without them may seem to be impossible. Recently, I was checking out at safeway and the person in front of me was using their debit card to buy a single bottle of soda. As long as this is our culture, the banks, card processors and other financial institutions will not get serious about protecting our information.

The recent security breach at CardSystems Solutions is a case in point. The company's official statement is very self-serving. You can read it here: http://www.cardsystems.com/news.html

What they do not tell you, but what the President admintted to the press, was the fact that they should not have even had the files in the first place. The data was being collected for "research purposes" by the company.

Both the major television networks and large market newspapers have now run stories about the black market in stolen credit card information. You can read the NY Times here: NY TIMES: 6/21/2005 (may need to subscribe).

Here is another example, this time from CVS, a major drug store chain, that did NOT make the news, even though the number of accounts exposed was bigger than the CardSolutions event. The media must think that two times in one week is too much to handle. http://www.msnbc.msn.com/id/8305849/

Credit Card companies even penalize merchants who accept fraudulent credit cards, even though they depend on the processors (agents of the issuers) to do the validation.

When will these companies get serious? When we, the consumers, stop buying in to their slick promotions of convenience. There are only two actions that we need to take: Use cash and write checks. As much as possible, use only your own bank's debit card at your own bank's ATMs.

Start by returning retail credit cards to the issuing company. If it is from Kohl's, then send them back to Kohl's with a letter that says that you are closing your credit card account until the banks and processors get serious about security and the protection of information on our lives.

Write more checks. The transaction that costs the banks only a few cents to process electronically will cost the same bank significantly more to process if it is a check.

As long as the consumer is not serious enough to change their behavior, the financial corporations will not be serious enough to actually fix the problem.