One of the most pressing questions in the wake of the Hannaford Bros. credit card data breach is whether the supermarket chain was in compliance with the Payment Card Industry Data Security Standard, a multifaceted security standard that includes requirements for security management, policies, procedures, network architecture, software design and other critical protective measures.
If the retailer was PCI-compliant (Payment Card Industry-compliant), that holds potential implications for the effectiveness of PCI. If Hannaford was not PCI-compliant, then consumers whose data was exposed will rightly wonder why the protocols were not followed.
A class-action suit filed March 19 on behalf of affected consumers by law firm Berger & Montague makes the answer to questions about Hannaford’s PCI compliance even more critical.
However, there is one catch to ascertaining the status of Hannaford’s PCI compliance at the time of the breach. There is no central body that certifies, tracks or reports retailers’ PCI compliance efforts.
The PCI Security Standards Council-a global forum founded by American Express, Discover Financial Services, JCB, MasterCard Worldwide, and Visa International-sets standards, but does not certify or enforce them. And the major credit card companies, who rely on reports from acquiring banks to determine who is following PCI protocols, do not make that information public.
Something is amiss here. Consumer concerns over the security measures (or lack thereof) protecting their sensitive personal information have never been higher. It appears that having some type of public certification for PCI-compliant retailers would go a long way toward easing some of those legitimate concerns and would benefit the retailers and credit card companies involved.
To some extent, this may be a classic situation where a need exists but there is no obvious candidate to fill it. The PCI Security Standards Council lacks the resources to serve as a true enforcement body. The retail industry, already overloaded with an endless variety of councils and forums that manage a plethora of standards, is likely not anxious to create a new standards organization. The credit card companies have already made the effort to create the PCI Security Standards Council, and the less said about asking the government to step in, the better.
A PCI compliance Web page
So what is the answer to this informational dilemma? Since I’m pointing out the problem, I suppose I should at least suggest a solution. At least for now, I think the best answer would be to have retailers voluntarily allow the results of PCI compliance reports collected by major credit card companies to be made public. This could be accomplished simply by having credit card providers maintain a Web page with a list of retailers their acquiring banks have indicated are PCI-compliant.
This would not require creating any new oversight mechanisms and would not be too onerous a responsibility for the credit card companies, which could update their online lists every quarter. It also would certainly serve the interests of retailers who are PCI compliant, both in terms of increasing consumer confidence and of providing public evidence they did take responsible security steps in the event there is some type of breach and a lawsuit follows.
If enough PCI-compliant retailers participated, it would furthermore create peer pressure for their non-compliant colleagues to take the necessary action to “get on the list.”
This may not be the perfect solution, or even practical, but at least it is an attempt to get the industry thinking about ways to make PCI compliance a less opaque subject.
The other aspect of PCI compliance that needs to be publicized is the fact that no set of security standards can guarantee against theft or fraud. As RSR Research analyst Steve Rowen commented to eWEEK, PCI compliance is simply evidence that retailers are using business tools to protect customer information. Unfortunately, in the Information Age, that is about as close to a sure thing as consumers are going to get when it comes to guarding their personal data.
Dan Berthiaume covers the retail space for eWEEK. For more industry news, check out eWEEK.com’s Retail Site.