FTC Urged To Disregard PCI DSS And Start An Investigation Into Antitrust Violations

Jul 26, 2016

The National Retail Federation (NRF) has recently asked the Federal Trade Commission (FTC) to start an investigation into an organization that sets data security standards. The organization was established by the credit card industry, and, according to the NRF, applies some controversial practices that raise antitrust concerns.

Standards Set by the PCI Standards Security Council

The world’s leading retailer advocacy group has asked the Federal Trade Commission to disregard the standards associated with data security. These standards were imposed by the PCI Standards Security Council.

The requirements set by the PCI DSS have long been argued by retailers. According to retailers, the PCI SSC is a proprietary organization run by the networks that have their own rules and do not focus on retailers. The National Retail Federation finds an inquiry into the way retailers leverage third parties to carry out PCI assessments should not regard the PCI DSS as the best example of data security.

To provide top security for payment processing, merchants should apply to a reputable processor like eMerchantBroker. EMB is the #1 high risk merchant account provider in the US and has an A+ rating with the BBB. EMB offers reduced chargebacks thanks to its unmatched fraud protection services.

Retailers Urge FTC to Discount PCI as Standard

In a letter to FTC leadership, Mallory Duncan, senior vice president and general counsel for the NRF, urged the FTC not to rely on the PCI DSS. As Duncan notes, it should be taken neither as the best practice in the industry, nor as a standard determining reasonable data security in the payment system or elsewhere.

According to Duncan, PCI can be described as a proprietary organization formed and controlled by a single industry sector – the most powerful credit card networks. He furthers notes PCI is not an open organization developed on principles that are called to set standards and which are recognized by the United States Standards Strategy.

The National Retail Federation is sure an anti-trust investigation of PCI must be conducted. The Federation calls the organization an inappropriate use of market power by the key US payment card networks. Moreover, the NRF finds PCI should no longer be responsible for determining data security standards the way it is currently doing.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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