By  on September 19, 2005

CHICAGO — In face of recent security breaches of credit card information and transactions, and a June 30 security compliance deadline, retailers are working to adapt to an industry-wide data security standard devised by major credit card companies such as Visa and Mastercard.

Industry sources estimate that as many as half of the retailers and merchants in the U.S. are not in compliance of the standard, but are working on complying by upgrading their data security systems. Michael Petitti, senior vice president of AmbironTrustWave, Chicago, an security advisory firm, said, "Very few retailers or merchants are compliant the first time around. Most of the ingredients are in place, but it's just a matter of making sure the appropriate policies and procedures that govern the technology are in place."

The credit card security standards include 12 steps designed to increase the security of credit card payment transactions. Standards range from firewalls to encrypting transmissions of cardholder data over public networks. Failure to comply with the standards could lead to fines and expulsion from credit card acceptance programs.

While in the short term more merchants are working on making their current systems compliant, Petitti said, ultimately, the industry will incorporate the standards on the front end.

"Down the road, if we're having this conversation five years from now, you'll see compliance and data security become more a part of the business process of accepting credit card payments. I don't think it will always be an adjunct compliance audit. At some point, it will become very much a part of becoming a merchant to begin with," Petitti predicted.

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