Credit Card Security Issues On Restaurants

Sept. 2, 2009 - PRLog -- Tightening up credit card security on restaurants

Hundreds and even thousands of restaurants is being opposed by the credit card industry for not fully protecting their customers' credit card data from the possibility of theft, with Visa, MasterCard and financial organizations that process electronic payment over the months are sending warning letters and conducting seminars. With these moves, it forces restaurants into taking more action when it comes to guarding their diners' credit card info.

According to companies that process card transactions, there are thousands of restaurants that are not complying with credit card industry security rules.  Any company that takes plastic is required to follow a set of security regulations instituted by Visa, MasterCard, American Express and Discover.

Data recorded by Visa indicates that since January 2005, restaurants made up around 40 percent of incidents in which criminals gained unauthorized access to credit card information -- provides the largest percentage of incidents for a merchant category.

Separately, there are reports from a Chicago-based data security auditor, AmbironTrustWave, for merchants that 62% of the security violations it witnessed during the prior 18 months occurred in the restaurant industry.

The violations involved various security lapses such as poorly guarded wireless networks -- which enable thieves to access information from the parking lot using a laptop -- and lax systems that make it possible for unethical employees to grab credit card information.

Mostly, consumers are unaware when their credit card data is in danger. Although, not all security breaches succeeds, and most merchants do not recognize these incidents unless there is a significant likelihood that a major fraud will take place or has already been identified. In addition, companies that issues credit cards don't usually close a customer's account unless fraud has taken place.

Restaurateurs may have a hard time with credit card security rules, since its regulations can be very hard for small sized businesses. The National Restaurant Association trade group says that it hears from restaurant owners who thought they complied with rules, but found out their systems were not functioning properly and were penalized.

An amount of $100,000 or more in some cases have been fined to restaurants that were caught violating the credit card industry rules by keeping credit card information. In 2006, Visa fined merchants across all categories $4.6 million for security violations, an increase from the $3.4 million in fines the previous year.

Visa, believes a merchant group needs additional attention, held special security briefings with several hundred restaurants.

During the same time, the companies that process credit cards have also turned the heat on restaurants. These credit card companies have threatened to end services to those that do not follow security regulations.

Since most restaurants uses special software with features such as as tabulating bills, delivering orders to the kitchen and tracking reservations, credit card companies are especially worried because they cannot force software makers to follow their security rules, so the pressure it passed on to restaurants. Visa has a list of software programs that meet its requirements maintained on their web site.

But software makers that even with the best software, restaurants could still be in a lot of trouble if they have a weak password protection or firewalls. For software companies, they say that it's not their part to let restaurant owners know what they must do to be in compliance with credit card rules.

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The author of this article is the VP of Customer Relations at POS-For-Restaurants.com with over 20 years experience helping restaurants nationwide increase their efficiency and bottom-line profits using restaurant POS systems.

You may visit http://www.pos-for-restaurants.com for more information on how our national network of restaurant point of sale experts can help your business achieve greater success in these difficult economic times.

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