Are YOU prepared for a restaurant point of sale credit card PCI security audit?

Security rules on credit cards for restaurants

The credit card industry has been coming down hard on thousands of restaurants that have not sufficiently protected their customers’ credit card information from potential theft, with Visa, MasterCard and financial institutions that process electronic payment over recent months sending warnings letters and holding seminars. With these moves, it forces restaurants into taking more action when it comes to guarding their diners’ credit card info.

For the companies that process card transactions, there are many food service establishments that are not complying with the security rules set by the credit card industry.  Any company that takes plastic is required to follow a set of security regulations instituted by Visa, MasterCard, American Express and Discover.

With the data recorded by Visa indicates that since January of 2005, restaurants made up around 40 percent of incidents in which criminals gained unauthorized access to credit card information — accounting for the largest percentage of incidents for a merchant category.

Separately, AmbironTrustWave, a Chicago-based data security auditor for merchants, reported that 62 percent of the security violations it witnessed during the prior 18 months occurred in the restaurant industry.

These violations includes various security lapses such as wireless networks that are poorly guarded — which easily enable thieves to access sensitive information using a laptop from the parking lot — as well as the lack of strictness to their systems that makes it a lot easier for bad employees to steal credit card information.

Consumers often are unaware when their credit card information is in danger. Not all security breaches produced successful fraud, and most merchants do not recognize these these incidents unless there’s a significant probability that a major fraud has already been identified or about to take place. In addition, credit card issuers usually do not close a customer’s account unless fraud has taken place.

Restaurant owners may have a tough time with credit card security rules, since the regulations can be difficult for smaller merchants. The National Restaurant Association trade group says that it hears from restaurant owners who thought they complied with rules, but found out their systems were not functioning properly and were penalized.

An amount of 0,000 or more in some cases have been fined to restaurants that were caught violating the credit card industry rules by keeping credit card information. Visa fined merchants across all categories .6 million for security violations in 2006, an increase from the .4 million in fines the previous year.

After recently conducting special security briefings with several hundred restaurants, although they declined to provide a breakdown of merchant types, Visa believes a merchant group needs additional attention.

At the same time, the companies that process credit cards have also turned the heat on restaurants. These credit card companies, as punishment, will end services to those who disregards the security regulations.

Credit card companies are especially worried about specialized software restaurants use, which combine such features as tabulating bills, delivering orders to the kitchen and tracking reservations. Since credit card companies cannot require software makers to abide by their security rules, they instead apply pressure to restaurants. Visa has a list of software programs that meet its requirements maintained on their web site.

But software makers that even with the best software, restaurants could be in trouble if they do not use password protection or firewalls. For software companies, they say that it’s not up to them to let restaurateurs know what they must do to be in compliance with the security rules of the credit card industry.

The author of this article writes for POS-For-Restaurants.com, a VP of Customer Relations with over 20 years experience in restaurant point of sale system, helping restaurant owners nationwide increase their efficiency and bottom-line profits.

To learn on how our national POS network of restaurant point of sale specialists can help your business achieve greater success in these difficult economic times, visit POS-For-Restaurants.com.