Payment Card Industry Data Security Standard AAFA ISC/SCLC Fall 08

PCI DSS What is it? A set of standards developed by the major credit card companies as a guideline to help organizations that process credit cards prevent credit card fraud and various other security vulnerabilities and threats.

Why should I care? If you process, store, or transmit payment card data you should be compliant (credit card companies expect it) Non compliant companies who process payment card transactions run the risk of: Losing their ability to process credit card payments Increased transaction rates Audits Fines Or Worse!…

Why should I care? Approx 100 million credit and debit card numbers were stolen by computer hackers 455,000 customers who returned merchandise without receipts had their personal data stolen including drivers license numbers. Thieves used this data to acquire $1 million in merchandise with gift cards from Wal-Mart and Sams Club AP - March 29, 2007

Why should I care? Forrester estimate (4/15/08) - $1.35 billion Facing possible class actions lawsuits from customers Offering 3 years of free credit monitoring for 455,000 customers Compensating customers to replace drivers licenses if their number is the same as their social security number Lost customer confidence and trust Decrease in stockholder faith Loss of revenue AP - March 29, 2007 Failure to comply could be costly!

Why should I care? TJ Maxx not alone Will your company be next?

Whats required to be compliant? Under the current standard (version 1.2), there are 12 requirements organized into 6 logically related groups called control objectives Build and Maintain a Secure Network Protect Cardholder Data Maintain a Vulnerability Management Program Implement Strong Access Control Measures Regularly Monitor and Test Networks Maintain an Information Security Policy

Build and Maintain a Secure Network Requirement 1: Install and maintain a firewall configuration to protect cardholder data Requirement 2: Do not use vendor-supplied defaults for system passwords and other security parameters

Protect Cardholder Data Requirement 3: Protect stored cardholder data Requirement 4: Encrypt transmission of cardholder data across open, public networks

Maintain a VulnerabilityManagement Program Requirement 5: Use and regularly update anti-virus software Requirement 6: Develop and maintain secure systems and applications

Implement Strong Access Control Measures Requirement 7: Restrict access to cardholder data by business need-to-know Requirement 8: Assign a unique ID to each person with computer access Requirement 9: Restrict physical access to cardholder data

Regularly Monitor and Test Networks Requirement 10: Track and monitor all access to network resources and cardholder data Requirement 11: Regularly test security systems and processes

Maintain an Information Security Policy Requirement 12: Maintain a policy that addresses information security

Myth #1: Breaches only happen to big-box retailers Fact: Small- to medium-sized merchants are highly vulnerable and a frequent target. Based on most of the news coverage, security breaches may seem to happen only to huge corporations – such as the TJX security breach. But, in reality, cardholder data compromises affect small online store owners far more frequently. Why? Because, the sheer number of them (according to Visa more than 6 million) makes them a more frequent target. Also, they are typically the least sophisticated technologically making them an easier target for hackers and carders.

Myth #2: PCI compliant merchants cannot be breached. Fact: While it is a critical step, PCI DSS compliance is only a periodic measurement at a point in time – not a guarantee. Just ask Hannaford Brothers groceries if PCI compliant merchants cant be breached. They were thought to be PCI compliant, but were still affected by a very public breach. Theres a danger that organizations can develop tunnel vision dealing with PCI at the expense of building a sound security program. Companies should develop a consistently high security posture, and in doing so, they will achieve PCI compliance. Any system involving people is vulnerable, either from accidental error or intentional acts of theft.

Myth #3: E-commerce merchants that use PCI compliant shopping carts or payment gateways are by default PCI compliant. Fact: This may be the case, but PCI guidelines cover not only data security but also the physical security and the existence of written security policies. Once a year, regardless of how the merchant handles card data, every merchant is required to complete an self assessment questionnaire, to complete the relevant Attestation of Compliance and, in most case, to submit the SAQ and the Attestation of Compliance to their acquirer. While it is important that terminals, gateways and shopping carts are compliant, that doesnt guarantee that merchants are secure from a physical standpoint or that they have employee training programs or security policies in place. SAQ A was specifically developed for merchants who outsource to a secure terminal.

Myth #4: PCI compliance is too expensive. Fact: Non-compliance can be very expensive if not catastrophic. Non-compliance doesnt just result in costs associated with fines, credit card replacement and audit fees, but also from loss of business reputation and revenue. In fact a recent study stated that 70 percent of the cost of non-compliance was loss of revenue. This is significant for big companies that are crucified in the press, but may be catastrophic for small vendors, putting them out of business.

Myth #5: PCI compliance is getting easier. Fact: The PCI Security Standards Council is working hard to clarify and simplify the standard. For example, in October 2008, the Council released version 1.2 of the Self-Assessment Questionnaire (SAQ), which now consists of four versions of the SAQ instead of the previous one-size-fits-all approach. While the attempt to segment merchants by validation type is a big step forward, it still presents confusion among many small merchants who are unclear on which SAQ they should complete. For small merchants in particular, protecting card holder data and maintaining a secure environment remains a complex endeavor.