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Friday, March 16, 2018

NAC's Choke Point battle rages on

W hile the U.S. Department of Justice officially terminated Operation Choke Point Aug. 16, 2017, it appears numerous financial institutions have not received the memo. Opponents claim the Obama-era anti-fraud initiative, originally designed to combat criminal activities, has inadvertently harmed millions of legitimate business owners.

Critics maintain that by stigmatizing entire industry sectors, the OCP measures have led to stringent "de-risk" policies that inhibit high-risk merchants from opening and maintaining bank accounts and lines of credit. Their claims are further supported by an independent study published in March 2018, by the National ATM Council Inc., a trade association representing the retail ATM industry.

The retail ATM industry has rigorous compliance guidelines in place, noted NAC Executive Director Bruce Renard. "U.S. ATM owners and operators are thoroughly vetted before and after entering the ATM business; and, as such, they are not 'high risk' accounts that should be having these sorts of problems in obtaining bank accounts or access to cash," he stated. Renard said the association will continue to advocate on behalf of its members, to fully eradicate OCP's unwelcome residual effects on the national independent ATM community.

NAC Chairman and Access One Solutions Chief Executive Officer George Sarantopoulos said NAC is using practical approaches to end bank account blacklisting. He said NAC leaders and members are working with regulators, field examiners and financial institutions to restore ATM ISOs' and independent ATM deployers' access to financial services. He urged members to remain vigilant, stating, "NAC will continue the fight for the independent ATM operators who continue to struggle with bank account issues, despite Choke Point going away."

NAC returns to Washington

In July 2017, NAC directors and members met with Senate Banking Committee and House Financial Services Committee members to address ATM industry issues, with OCP topping the agenda. When OCP was disbanded a month later, NAC leaders declined to take full credit but acknowledged their efforts may have helped end the program.

On Feb. 15, 2018, Timothy W. Baxter, NAC founding director and President of Dallas-based Swypco LLC, testified before the Financial Institutions and Consumer Credit Subcommittee of the House Financial Services Committee. Both Renard and Sarantopoulos attended the hearing, titled "Examining De-risking and its Effect on Access to Financial Services."

Renard returned the following month to meet with congressional leaders. In a series of meetings, held March 6 through 9, 2018, he presented NAC survey highlights and OCP's ongoing residual effects on retail ATM stakeholders. Survey demographics show independent ATM deployers provide nearly 60 percent of the 470,135 ATMs in the United States. A majority of these "non-bank" ATMs are located outside major banks' footprints, Renard said, adding that these independent ATMs provide critical banking services to un-banked and under-banked consumers.

"I am encouraged that this un-American, anti-consumer, and anti-competitive blacklisting of independent/retail ATM bank accounts is finally getting the attention it deserves in Washington," Renard stated.

Midmarket to drive global cybersecurity spend
Thursday, March 15, 2018

O ver the next four years, midmarket companies are expected to drive 70 percent of global investment in cybersecurity solutions, which could reach $134 billion in total combined global annual spending by 2022, according to U.K.-based Juniper Research Ltd.

Juniper cited cybercriminal exploit of "low-hanging fruit" as a persistent concern, especially among midmarket companies. Small businesses have long been a stable target of cybercriminals, the focus of 43 percent of cyber-attacks launched in 2015, according to Symantec Corp. Research by the cybersecurity firm revealed that in 2017, hackers managed to steal $172 billion from 978 million consumers in 20 countries.

Increasingly aware of the rising cost of fraud to consumers, midmarket companies are equally concerned about the devastating toll on businesses compromised by fraud in recent years. The National Cyber Security Alliance reported that 60 percent of businesses affected by cyber attacks close their doors within six months of an attack. Juniper predicted the cumulative cost of data breaches from 2017 to 2022 will reach $8 trillion.

IoT complicates matters

Perhaps one of the biggest challenge in the years ahead will be how to effectively secure Internet of Things (IoT) devices. Juniper estimated that global penetration of Internet-connected devices will reach 46 billion activated units by 2021.

According to Juniper, because modern devices are typically deployed for years at a time in the marketplace, forward-thinking cybersecurity strategies will need to be flexible enough to react to future demands as more advanced exploits by cybercriminals render modern approaches less effective over time.

As a result, stakeholders must plan in terms of risk mitigation rather than prevention, Juniper noted, adding that in some cases service providers in high-risk environments will be forced to restructure their networks to avoid potential compliance breaches, data theft and even service outages.

"Once a single endpoint is breached, the big danger is lateral movement across the network," wrote Juniper research author Steffen Sorrell. "Layered networks, proper lifecycle management and user 'least privilege' approaches will prove key to containing serious breaches." For more market insights, Juniper offers a free whitepaper, Cybersecurity -- How can service providers save the bottom line? In addition, the firm's Cybersecurity: Mitigation Strategies for Financial Services, Operators, Enterprise & IoT 2018-2022 report is available for purchase online at .

NRF identifies flaws in data breach bill
Thursday, March 15, 2018

I n a March 7, 2018, meeting with U.S. House Financial Services Committee members, the National Retail Federation urged the committee to rewrite proposed legislation pertaining to data breach notifications. The NRF, which has long pushed for uniform data breach legislation, called the bill a good effort that falls short of protecting retailers. At issue are a "one-size-fits-all" approach and overly protective stance toward select parties, according to NRF Vice President and Senior Policy Counsel Paul Martino.

Martino found loopholes in the bill's first draft that he claimed would exempt financial institutions and third-party service providers from punitive actions, as well as allow organizations to hide major data breaches from public view. "We want to work with the committee to develop an airtight bill that covers all industries and ensures that all data breaches are subject to notification no matter where they occur," he stated.

Proposed guidelines introduced by Reps. Blaine Luetkemeyer and Carolyn Maloney call for federally enforced data security and data breach notifications overseen by the Federal Trade Commission. Ideally, these uniform protections would create a flexible, technology-neutral data security standard. They would also require breached parties to notify consumer and law enforcement immediately when personal information has been stolen or compromised.

Four critical principles

In a March 7, 2018, letter, the NRF and other retail organizations, collectively representing more than a million U.S. consumers, petitioned the House Financial Services Committee to include four critical principles in the proposed data breach legislation: create a uniform, national law; set reasonable security standards; maintain appropriate enforcement; and notify all breached entities. They also brought up the following issues:

Call for equal responsibility

In addition, the authors voiced concerns that the legislation sets an "immediate" standard for notice that they believe may be unachievable. The letter was signed by the following parties:

NRF representatives maintained that varying approaches to data breach enforcement in 48 states are inconsistent and conflicting, which can be confusing for consumers and multistate retailers. The association is calling for a uniform federal law that holds banks, card processors, telecommunications companies and other entities equally responsible for managing sensitive consumer data.

Tradeshows flourish, new products shine
Tuesday, March 13, 2018

T here is a tradeshow for just about every type of payment professional these days. This week, for example, the Southeast Acquirers Association is hosting its annual show March 12 through 14 in Orlando, Fla. And across the world, Money20/20 Asia is taking place March 13 through 15 in Singapore. One is regional; the other is international; both offer considerable educational, inspirational and networking opportunities.

Companies often take advantage of the buzz surrounding tradeshows to introduce new products into the marketplace. For example, at Money20/20 Asia, Verifone just introduced what it described as "the first in a line of commerce solutions that brings mobility, payment, and commerce into one powerful, portable device. From tier one retailers to small businesses, merchants around the globe will soon be able to accelerate their business with Carbon Mobile 5."

Carbon Mobile 5

Verifone noted that Carbon Mobile 5 fits into the palm of a merchant's hand and, in addition to enabling checkout, it offers the ability to run Android apps such as POS, loyalty and inventory management. Carbon Mobile 5 will begin rolling out this year and will be available with and without an integrated printer, and both variations come with the advanced feature set necessary to support in-aisle sales, clienteling, endless aisle solutions and much more, the company added.

“We’re seeing our global merchant partners increasingly dedicating resources to the customer experience. Through one-to-one customer interactions and targeted programs, retail leaders are demanding technology to personalize the shopping experience,” said Julie Johnson, Senior Vice President of Global Product Management. “The priority is to get to know the customer, and Carbon Mobile 5 provides the platform to engage customers and ‘do it all’ from a single, mobile device.”

STA, ETA shows coming up

Meanwhile, at SEAA in the Sunshine State, merchant level salespeople, ISOs, processors, hardware and software manufacturers, the media (including representatives from The Green Sheet Inc.), as well as startups and entrepreneurs with bold ideas, are receiving up-to-date information on the industry's challenges, opportunities and trends; connecting with potential partners and reconnecting with old friends; honing their presentation skills; and getting recharged to better the odds they will reach their business goals.

Also coming to Orlando will be the Secure Technology Alliance, which will host Payment Summit 2018 from March 26 through 29. To register for that show, visit .

Less than a month later, Transact ‒ Powered by ETA will take place in Las Vegas from April 17 through 19.This dynamic, comprehensive show promises a mix of traditional events, presentations and showcases along with new offerings such as Next Gen Park for accelerators; Biometric + Identity Zone, powered by IBIA; Contactless Zone; and ETA Law School. For details, visit .

In memoriam: Philip G. Garcia
Monday, March 12, 2018

P ayments industry veteran Philip G. Garcia passed away Feb. 28, 2018, following a brief illness. Born April 13, 1955, Garcia was a skilled technical analyst at Intel Corp. He had previously worked for more than 16 years at Hypercom Corp. and made many friends in the payments community during his tenure. Tom Salamone, Owner of Wellington Weir Human Resource Solutions, was Senior Vice President of Human Resources at Hypercom when he met Garcia. He remembers a man who had a smile and kind word for everyone he met.

"He was instantly likable and a person you remembered for all the right reasons," Salamone said. "Phil liked people; it was obvious in his manner, there was no pretense, no posturing. He was genuine in every way, a truly rare quality. Anytime you met him, he was upbeat and positive; he always seemed happy to see you. His passing comes with both a sense of shock and a sense of loss."

A rosary will be held in Philip G. Garcia's honor at 8:15 a.m., Tues., March 13, 2018, at St. Joseph on the Rio Grande Church, 5901 St. Josephs Ave. NW, Albuquerque, N.M., followed by a memorial mass at 9 a.m. His burial will take place directly afterward at Sunset Memorial Park, 924 Menaul Blvd. NE. Following the service, family and friends are invited to a celebration of life at The Vineyard Adult community center, 6118 Edith Blvd. NE from 11: 30 a.m. to 2:30 p.m.

Additional information is available at .

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