The FTC workshop was held in the William Gates law building from 8:30 until 4:45. I missed the first speaker of the day but caught pretty much everyone else. The following are my notes and observations from some of the speakers.
Panel: Consumer Understanding and Acceptance of Contactless Payment Technology
Jodi Golinsky, MasterCard
- PayPass, MasterCard’s contactless cards are processed the same way as normal credit or debit cards.
- PayPass cards have unique, dynamic transaction numbers so even if the data is captured it cannot be reused.
Jean Ann Fox, Coonsumer Federation of America
- If you don’t have a lot of money, if you can just tap your card you may spend more.
- Contactless cards, meant to replace cash, allow tracking of consumer/market behavior that cash doesn’t.
- Contactless cards may not be covered by the same federal laws like the Truth in Lending Act.
Mark MacCarthy, Visa
- The cost of the fraud is not put on the back of the cardholder. It falls to the bank or credit card company so they have good incentive to make it safer.
- Visa also has dynamic, transaction specific numbers and they are adding another way to make the number more unpredictable. — MC already has it.
If you get the card number and expiration date you can use them online unless they require entry of the number on the back of the card which is not stored on the chip.
Old cards will be replaced with new technology by a certain date.
Panel:Contactless Payment Cards
Peter Ho, Wells Fargo Card Services
- They put a silver foil sticker on the cards when sent out in the mail to prevent it from being read until the sticker is removed.
- If you get the card’s information, you can’t really do anything with it. You can’t clone the card as a magnetic stripe card.
Dan Johnson, Tully’s Coffee Corporation
- People who have contactless cards actually use them.
- People without contactless cards may still try tapping them on the reader and be confused why it doesn’t work.
Kevin Fu, University of Massachusetts Amherst
- You can disable the chip in the microwave but you get sparks. You can also disable it with a hammer.
- When they say the chip is encrypted, it really isn’t.
- They have created readers where you can put a reader in a briefcase, walk up to someone, and it will read their card inside their wallet, inside their pocket and come up with their name, credit card number and expiration date.
- Even technically educated people may have no idea that their cards may have chips in them.
Tom McAndrew, Coalfire Systems
- As long as you still have backwards compatibility it lowers your security.
Etona Uedo, Nomura Research Institute, Ltd. (from Japan)
- Almost half of people in Japan have E-money, but only in big cities.
- Using E-money as money alone is very costly. Coupling it with some other service is better, such as for mass transportation ticketing.
- They don’t track your name and don’t really care what it is, but they may track your movement and behavior.
After lunch:
Panel: Mobile Payment Devices
Susan Grant, Consumer Federation of America
- Consumers may not be aware that the personal information on their phones can be compromised.
- Children may not carry credit cards but they do carry mobile devices, so if cellphones act as credit cards, there may be social changes needed.
Peter Wakim, Nokia Inc.
- NFC (Near Field Communication) is developed to be purposely close range so a tap is required.
- Still only in trials (since 2001)
- They have used PINs to increase security. You have to enter the PIN each time before it will function as a credit card.
- If you lose your phone it can be deactivated over the air where credit cards cannot be.
Siva Norendra, Tyfone USA
- They have investigated putting RFID info and antenna on memory cards instead of SIM card to allow you to keep the phone provider from being a middleman.
- It is important to allow consumer choice to have any phone, any service provider, and any bank.
Andras Vilmos, SafePay Systems Ltd. (from Hungary)
- They should allow customizable selection of mobile services.
- In Europe, mobile ticketing was what pushed the technology.
- They have a bunch of trials throguht Europe but they are not connected and still not ready to be commercial.
- People who haven’t tried it really don’t care but people who have tried it tend to like it though they still want security features like PINs.
- The readers for contactless payment cannot tell the difference between a card and a phone.
There is already antivirus software for cellphones and viruses, though there isn’t much point yet since little important information is stored on them so far.
Panel: Meeting the Challenges: Strategies and Approaches
Alissa Cooper, Center for Democracy and Technology
- Even though the bankc and merchants who came today are “best actors,” not everyone tries to do the best for the customer.
David Moorman, PCMS Group
- “Something that is readable from two inches today will be readable from 2 miles in the future”
- Google: “PCI and the Circle of Blame”
- One-off transactions add up if undetected - Hanford breach was 4.5 million one-offs
Kathryn Ratte, Federal Trade Commission
- The FTC does not govern banks, but they do regulate most other commerce.
John Carlson, BITS/Financial Services Roundtable
- You can’t be so afraid of how a technology could be abused that you don’t look into it at all.
Other observations that I took away from the workshop:
- Both Leilani and I, and my landlord have WaMu debit cards which apparently have the PayPass chips in them. We had no idea. My landlord had never heard of the tap and go technology. The documentation that came with my card only mentioned that it had PayPass and suggested stores it could be used in. It made no mention of what technology was behind it or any possible dangers. I was a bit unnerved to find out that I was actually carrying around a little RFID chip that may have my name, credit card number, and expiration date and no one bothered to tell me that. I’m interested to know whether my name is masked on the chip.
- You really can’t stop people from reading the cards. You just have to make it so that the information they would get is not usable.
- As long as there are online merchants who do not require the added security features, the backwards compatibility means that stolen credit card numbers can be used there.