New data security legislation could make restaurants take the blame, bear the costs

• Published in: Nation's Restaurant News Vol. 41; no. 35; p. 22
• Main Author: Hermann, Dave
• Format: Journal Article Trade Publication Article
• Language: English
• Published: New York Penton Media, Inc., Penton Business Media, Inc. and their subsidiaries 03-09-2007; Lebhar-Friedman, Inc
• Subjects: Beliefs, opinions and attitudes; Computers; Costs; Credit card industry; Credit cards; Criminals; Customers; Cybercrime; Data integrity; Fines & penalties; Hackers; Legislation; Liability; Litigation; Politicians; Restaurant industry; Restaurants; Services; Software; Texas; United States > US
• ISSN: 0028-0518

A security breach is a nightmare for any restaurant operator, but the remedies being offered by policy-makers can be just as troubling. Texas is just one of the many states where proposed legislation intended to enhance security and protect customers will result in excessive liability for restaurants and ultimately higher prices for customers. Under the Payment Card Industry-Data Security Standard mandates, businesses that process credit cards will be forced to pay thousands of dollars to keep pace with complex and constantly changing security features. Restaurants can be fined as much as $25,000 a month if customer financial data is stolen. As restaurants do all the work and assume all the liability, the big credit card companies do nothing to upgrade their data protection on credit cards.