Chip + Sig still pointless

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CC Deville
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Re: Chip + Sig still pointless

Postby CC Deville » Mon Oct 12, 2015 9:31 pm

JonE wrote:I have found two chip machines (At Kroger and Petsmart) and neither one work, even after October 1st.


I think some companies are holding off for a while to see where their chargebacks fall. The grocery store in my area-Fry's (a division of Kroger) has had the new chip terminals for several months now; yet like your store, they are not operational yet. Walmart, Home Depot, Target and Walgreens are all up and running.

The chip card approval takes a little longer to approve so I wonder if the grocery store is holding off for that reason.


flan
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Re: Chip + Sig still pointless

Postby flan » Tue Oct 13, 2015 11:35 pm

Vermonster wrote:The weakness of the US system is the signature.


NO. NO. NO. (imagine ten pages of that, in a bigger font.)

The weakness with the US system has been that's it trivial to clone the data on a magnetic stripe, and use that to make a copy of the card. Almost all (better than 95%, I've been told) card present fraud in the US is done with a fake cloned card. the chip in chip&anything makes it much harder to clone the card. (and, if you can clone the card, you can change the pin used for offline verification...) In the US, the only people who benefit from pin are the banks, and it's not clear they do, on net. pin cards are more expensive to issue, more expensive to maintain, and have higher support costs, and the amount of fraud they prevent is small.

When EMV was introduced, C&P and its offline verification, provided big benefit in parts of Europe, particularly Eastern Europe, where telecom networks were poor, unreliable, and expensive; plus a secondary benefit for the banks, in that they could push fraud costs onto the card holder in many countries. Neither of those are true in the US.

Chip and pin is no more effective at preventing card-not-present fraud than chip and signature.

Vermonster
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Re: Chip + Sig still pointless

Postby Vermonster » Wed Oct 14, 2015 7:51 am

flan wrote:
Vermonster wrote:The weakness of the US system is the signature.


NO. NO. NO. (imagine ten pages of that, in a bigger font.)

The weakness with the US system has been that's it trivial to clone the data on a magnetic stripe, and use that to make a copy of the card. Almost all (better than 95%, I've been told) card present fraud in the US is done with a fake cloned card. the chip in chip&anything makes it much harder to clone the card. (and, if you can clone the card, you can change the pin used for offline verification...) In the US, the only people who benefit from pin are the banks, and it's not clear they do, on net. pin cards are more expensive to issue, more expensive to maintain, and have higher support costs, and the amount of fraud they prevent is small.

When EMV was introduced, C&P and its offline verification, provided big benefit in parts of Europe, particularly Eastern Europe, where telecom networks were poor, unreliable, and expensive; plus a secondary benefit for the banks, in that they could push fraud costs onto the card holder in many countries. Neither of those are true in the US.

Chip and pin is no more effective at preventing card-not-present fraud than chip and signature.


If the signature was worth anything, it would be required for online purchases, or purchases under $25. The signature means nothing as far as security. The only time I have ever been prevented from buying anything was when I was asked for ID when I was purchasing $500+ of giftcards with a business credit card.

And while the US has a significantly better telecom system than much of Europe, we still have many areas that would do well with offline verification.
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