Multiple data breaches lead to improved security measures for federally issued cards.
Anyone can have their credit card declined, even the president of the United States.
President Barack Obama’s credit card was declined in September after he dined with the first lady at a New York City restaurant, CNN said. Apparently he rarely uses the card, so the card company declined it as a potential fraudulent purchase. Obama said:
“Luckily, Michelle had hers. I was trying to explain to the waitress that I’ve really been paying my bills.”
Obama recounted the story at the Consumer Financial Protection Bureau last Friday, where he signed an executive order bolstering security measures for federally issued credit and debit cards.
The executive order comes after multiple large-scale security data breaches in the past year, including Target, Home Depot, Kmart, Michael’s and Dairy Queen.
According to The New York Times, the measure is meant to help protect Americans from identity theft and fraud.
“You should be able to buy the things that you need without risking your identity, your credit score or your savings,” Obama said during the CFPB appearance.
Dubbed the BuySecure Initiative, the order requires that federal government-issued cards and payment terminals use chip-and-pin technology, which better protects consumer data. The Washington Post said:
The technology has been a standard outside the United States for years. Rather than having customers swipe their cards through readers, a store that uses chip-and-pin technology has consumers insert a card embedded with a security chip into the reader and enter a PIN code, similar to an ATM code.
Obama is directing federal law enforcement to provide information to the private sector about identity theft rings, the Post said. And the Federal Trade Commission will receive more resources to expand its IdentityTheft.gov site.
Obama also called on Congress to pass a national data breach law to provide “one clear national standard” rather than the patchwork of state laws that currently dictate how businesses should react to data breaches, the Post said.
The president is urging private sector companies to transition to more secure credit and debit cards. Target, Walmart, Home Depot and other companies have committed to adopting chip-and-pin cards by the end of next year, the Post noted.
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