Poor security practices and software flaws may leave data open to theft or loss
The recent disclosures that customer information was lost or stolen from retailers have led security experts to focus on two areas: poor security practices by the retailers and weaknesses in the software used to process credit-card payments.
Retail Ventures Inc. and Polo Ralph Lauren Corp. are the latest in a string of companies to report that customer credit-card information may have been stolen or lost. But a lawsuit involving IBM has highlighted the importance of what's known as Track II data, which contains customer and account information.
BJ's Wholesale Club sued IBM last year for allegedly failing to turn off a feature in its payment software that stored Track II data from a credit card's magnetic stripe after a transaction was approved. As a result, BJ's claims, Track II data on cards belonging to customers who made transactions between July 2003 and February 2004 may have been stolen and misused. A BJ's spokeswoman declined to comment, saying the case is pending.
Storage and retention of Track II data is expressly forbidden by Visa. "Track II data should never be stored," says Bill Pittman, president of TPI Software LLC, one of seven payment-software vendors whose applications have been validated by Visa.
Another of the companies, Radiant Systems Inc., modified its apps to delete Track II data, says Andy Heyman, president of Radiant's hospitality division. It has added 128-bit encryption to safeguard all other information.
All merchants are required to comply with credit-card company security rules. But some, known as level-four merchants, aren't required to validate their compliance. "Some of the recent breaches have occurred at level-four merchants," says Mike Petitti, senior VP of marketing at Ambiron TrustWave, which provides security assessments. "There's a need to address those risks."
How Enterprises Are Attacking the IT Security EnterpriseTo learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Infographic: The State of DevOps in 2017Is DevOps helping organizations reduce costs and time-to-market for software releases? What's getting in the way of DevOps adoption? Find out in this InformationWeek and Interop ITX infographic on the state of DevOps in 2017.
2017 State of IT ReportIn today's technology-driven world, "innovation" has become a basic expectation. IT leaders are tasked with making technical magic, improving customer experience, and boosting the bottom line -- yet often without any increase to the IT budget. How are organizations striking the balance between new initiatives and cost control? Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.