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Since its introduction in the United States, the retail sector has spent $25 billion to roll out EMV chip card technology. More than one million retailers can now accept chip cards and more than 326 million chip cards have  been issued – more than  the population of the United States. In a recent interview, David Derigiotis, director of the Professional Liability Center of Excellence at Burns & Wilcox, explained that while the cards are supposed to be impossible to replicate, cybercriminals have found a way to bypass the security.  Fortunately, since the stolen information is not static with the chip, according to Derigiotis, the fraudulent transaction will not work for the next purchase.

While chip cards are certainly helping reduce retail crime, there are several things  both the retailer and the shopper can do to make them more  effective. When  chip cards were initially introduced, banks were on the hook for  fraud. Now  the burden falls on the retailer. If they do not have the capabilities to processes the chip, they  are now liable for losses. As a result, retailers are responsible for constantly upgrading the terminal and uploading new software. Lastly, there are certain levels of encryption that help protect terminals from criminals. However, encrypting is expensive but without it, cybercriminals can pull the card, bypass the chip and make a new one. Not to mention, only 30 percent of retailers currently have the capability to process the chip and chip card technology does not work for online transactions.  As a result, it is crucial for shoppers to take control  and monitor their account statements instead of relying on their bank to do it for them. While Derigiotis claims the process is helping, if retailers do not spend more money  for encryption  technology, cybercriminals will remain  one step ahead.

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