President Barack Obama is stepping up the government’s cybersecurity battle. Under his BuySecure Initiative to help consumers fight credit card fraud and identity theft—America’s fastest growing crime—he’s issued an executive order designed to accelerate the adoption of more hacker-resistant technology while beefing up resources for victims.
Data breaches, like the recent ones at Home Depot, Target and JPMorgan Chase harmed more than 100 million Americans last year, according to President Obama. Here’s how the president’s latest moves can improve your financial safety: [Editor's note: An earlier version of this post mistakenly listed Bank of America as one of the firms that fell victim to a major data breach last year. That error has been corrected.]
1. Payments to and from the U.S. government will be more secure.
People who collect cash from federal sources, including pensions, Social Security and veterans’ benefits, but who don’t have bank accounts will receive this money in a more protected way. The government is updating its credit and debit cards to employ microchips and personal identification number verification. So-called EMV chips and passcodes make the cards harder to hack than those with magnetic strips that store the user’s account information. Chipped cards will become standard issue for federal employees and recipients of government payments who use Direct Express prepaid debit cards. New cards will be distributed starting in January.
2. Buying stuff at federal offices and locations will become safer as chip-card readers are installed.
The more-secure technology of chip cards is useless if merchants don’t have the equipment to accept them. The government is updating its card readers to work with the new plastic at all of its retail locations, including national parks, passport offices and Veterans Affairs offices. As President Obama noted inannouncing BuySecure, when Britain switched to a chip-and-PIN system, the country cut fraud in stores by 70%.
3. If your identity is stolen, the government will help you reclaim it faster.
Federal agencies have set a goal to cut in half the time it takes consumers to recover from identity theft. To start, the government is revamping the Federal Trade Commission’s IdentityTheft.gov website to make it a one-stop shop for victim resources, including a portal for consumers to report fraud to credit bureaus.
The president praised big retailers like Target, Home Depot, Wal-Mart and Walgreens for installing chip-card readers or pledging to by January. President Obama said one aim of his initiative was to lead by example. Nearly half of U.S. retailers are forecast to make the transition by the end of next year, according to the Payments Security Task Force.
President Obama said he hopes to set a national standard for card security. All businesses are encouraged to accept EMV chip cards by October 2015 or be held responsible for fraudulent charges, but BuySecure may inspire them to do it sooner. The U.S. Postal Service has already updated thousands of its locations to accept chip cards.
He may be the leader of the free world, but the president can’t do it all. President Obama renewed his call to Congress to pass legislation that would improve cybersecurity and reduce data breaches nationwide. For now, consumers can cross their fingers that they aren’t the next targets of hackers and financial fraudsters.
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