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NewsBriefs

This article contains summaries of news stories recently posted under The veto follows a federal court ruling in Illinois perma-
Breaking Industry News on our homepage. For links to these and other nently blocking enforcement of a similar state law for na-
full news stories, please visit www.greensheet.com/breakingnews.php. tional banks, out-of-state state-chartered banks, federal
savings associations and payment networks. The Illinois
ruling does not apply to Illinois-chartered banks or cred-
it unions, both of which plan appeals alongside retailer
groups.

Kurv report highlights hidden American Bankers Association President and CEO Rob
costs of payments fraud Nichols praised Polis’ decision, saying it spared consum-
ers, businesses and the state from “payment chaos” and
Businesses are facing growing hidden costs from pay- a costly legal battle. Merchant groups sharply disagreed.
ments fraud that extend far beyond direct financial losses Doug Kantor, executive committee member of the Mer-
and chargebacks, according to a recent research report chants Payments Coalition and general counsel of the
from Kurv. The report, The Growing Burden of Payments National Association of Convenience Stores, said the veto
Fraud on SMBs, found that many merchants underestimate leaves merchants and consumers paying “inflated, price-
the broader operational, reputational and customer-ser- fixed swipe fees” on sales taxes and purchases.
vice impacts associated with fraud incidents.
Polis argued the financial benefit to merchants would
Kurv said businesses increasingly must absorb additional have been relatively small. Based on Colorado’s combined
labor costs tied to fraud investigations, customer support, average sales tax rate of roughly 8 percent, he estimated
compliance obligations, technology investments and dis- the legislation would have reduced merchant costs by
pute resolution. The report also noted that fraud-related about 0.13 percent of a transaction’s gross total if fully im-
disruptions can strain internal teams, slow business plemented and upheld in court.
growth and divert resources away from strategic initia- Patent expirations reshape access control market
tives.
As key patents covering legacy HID Global 125 kHz prox-
The company highlighted rising concerns around account imity card technology expire, organizations are gaining
takeovers, synthetic identity fraud, business email com- new flexibility in employee identification and access con-
promise schemes and AI-assisted fraud tactics that allow trol systems. The low-frequency badge technology has
criminals to scale attacks more efficiently across digital long been used for tap-or-scan access to buildings and
commerce and real-time payments environments. facilities, but security experts say the aging systems are
increasingly vulnerable to duplication and unauthorized
In addition, fraud prevention is becoming a strategic busi- access.
ness function rather than simply a compliance exercise.
Fraud incidents can damage customer trust, increase cart According to Sebastien Goulet, chairman and CEO of
abandonment and contribute to long-term reputational CardLogix Corp., many organizations are reevaluating
harm. Excessive chargebacks and fraud activity may also access-control strategies as they adopt stronger authenti-
expose merchants to higher payment processing costs and cation and passwordless security initiatives. He said tra-
greater scrutiny from acquiring partners and card net- ditional 125 kHz proximity cards were designed primar-
works. ily for physical access and do not meet modern enterprise
security requirements.
Kurv further warned that overly aggressive fraud controls
can create payment friction, frustrating legitimate cus- Goulet believes businesses are increasingly looking to
tomers and reducing conversion rates. Kurv recommends unify physical access, computer logins and employee au-
real-time transaction monitoring, stronger authentication thentication into a single credential rather than relying
tools, employee education and close coordination between on separate systems managed by different departments.
fraud prevention, operations and customer experience High-memory smart cards capable of storing secure cre-
teams. dentials, biometric information and authentication cer-
Colorado governor vetoes interchange bill tificates could help organizations improve security while
streamlining administration and reducing costs.
Colorado Governor Jared Polis vetoed legislation that
would have prohibited interchange fees on the tax por- As enterprises and government agencies expand biomet-
tion of card transactions, drawing praise from banks and ric authentication efforts, information technology teams
criticism from merchant groups. In a letter to lawmakers, may also assume broader responsibility for both physical
Polis said he supports addressing payment-system friction and digital access management. Goulet said organizations
and credit card competition issues at the national level but that successfully combine physical security, digital iden-
questioned whether a Colorado-specific carve-out would tity and biometric authentication technologies will be well
be operationally feasible within the integrated payments positioned as credential-management systems evolve.
system.
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