NRF names former White House and congressional attorney Stephanie Martz as SVP and general counsel

WASHINGTON, 2017-Jun-27 — /EPR Retail News/ — The National Retail Federation announced today (June 26, 2017) that Stephanie Martz, a former White House and congressional attorney and partner at one of Washington’s top lobbying firms, will join the organization in September as senior vice president and general counsel. Martz will succeed retiring SVP and General Counsel Mallory Duncan.

“NRF is extraordinarily fortunate to have Stephanie joining our team,” NRF President and CEO Matthew Shay said. “Her experience in the White House, on Capitol Hill, at the Chamber of Commerce and in the courts gives the NRF and our members a level of expertise that will allow us to continue representing the retail industry at a level that is second to none. Whether legislation, policy or litigation, Stephanie’s track record of success speaks for itself and NRF will greatly benefit as a result of it.”

“There are a number of issues facing our industry that require a sharp legal mind to represent the interests of our members,” Shay said. “Stephanie has worked with a number of corporate counsels throughout her career, and whether the issue is swipe fees or data security, I am confident that Stephanie will build on Mallory’s legacy of inclusion and success in fighting for our industry.”

“I am excited to be joining the NRF and the opportunity it presents to work with some of the nation’s largest retailers,” Martz said. “I truly believe that this is a unique opportunity to work with a growing organization that is interested in a wide range of cutting-edge legal and policy issues — the issues which impact the retail industry, its employees and the millions of customers that retailers serve every day.”

As a partner at Monument Policy Group since 2015, Martz is a well-known expert on technology and new economy issues, with a range of clients from Silicon Valley to Seattle, Fortune 500 companies, industry groups and other businesses. Her areas of focus have included data privacy, cybersecurity, international data agreements and immigration. Prior to that, she was special assistant and senior counsel to President Barack Obama. In that capacity, she was the senior lawyer in charge of in-house counsel functions in the Office of White House Counsel and was also responsible for input on key policy matters.

Previously, Martz served as chief counsel to Senator Charles Schumer, D-N.Y., who is now the Senate minority leader. In that position, she provided political and legal analysis, drafted and reviewed legislation and formulated political strategy on a wide array of matters before the Senate. Other experience includes serving as a senior director at the National Association of Criminal Defense Lawyers, litigation counsel at the U.S. Chamber of Commerce, practice at two Washington law firms — Mayer Brown LLP and Miller, Cassidy, Larroca and Lewin LLP — and law clerk at both the U.S. Court of Appeals for the D.C. Circuit and the U.S. District Court for the District of Columbia.

Martz is a graduate of Georgetown University and Stanford Law School, where she served as executive editor of the Stanford Law Review.

Duncan, who has been general counsel at NRF since 1994, announced last week that he will retire at the end of August.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs — 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy.

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

The National Retail Federation announces the retirement of SVP and General Counsel Mallory Duncan

WASHINGTON, 2017-Jun-22 — /EPR Retail News/ — The National Retail Federation today (June 21, 2017) announced the retirement of Senior Vice President and General Counsel Mallory Duncan, a veteran lawyer and lobbyist who has guided the retail industry through legal, legislative and regulatory battles over credit card fees, bankruptcy law, privacy issues and other topics for more than two decades.

“Whether you’re appealing to the Supreme Court, testifying before Congress or meeting at the White House, Mallory is the lawyer you want by your side,” NRF President and CEO Matthew Shay said. “There is no brighter legal mind in the retail industry, and nobody understands the complexities and nuances of the issues he follows better than he does. He has been indispensable to me as a trusted advisor and I am sorry to see him go.”

“Working in the retail industry has given me the opportunity to play an exciting part in some of the most interesting issues of our day,” Duncan said. “Retail isn’t just stores and shopping. It’s about the economy, jobs and public policy issues that run the gamut from taxes to trade. I’ve spent the biggest part of my career representing retailers, but a large part of that is improving retailers’ ability to serve everyday consumers. I’d like to think I’ve helped restore the alignment of Main Street retailers and their customers against unfair practices that threaten them both.”

Duncan will leave NRF at the end of August but will continue to provide counsel on payments and other issues as a consultant.

“Mallory informed me earlier this year of his intention to retire at the end of the summer, and we have been actively engaged in searching for his successor,” Shay said. “We expect to make an announcement soon.”

Duncan joined NRF as general counsel in 1994. As such, he is responsible for all of NRF’s legal affairs, both directly and through coordination of outside counsel. As a member of the NRF executive team, he helps execute the federation’s strategic mission of advocacy, communications and education on behalf of the industry. He also manages the NRF General Counsels Forum, which is made up of chief legal officers at many of the nation’s best-known retail companies.

Duncan is best known as one of the retail industry’s leading voices for reform of credit card industry fees, rules and practices to make the card industry more transparent and competitive, an area where he has played a significant role since the mid-1990s. The announcement of his retirement comes after NRF’s recent victory in convincing the House to drop efforts to repeal reform of debit card swipe fees. In recent years, Duncan headed NRF’s legal challenge of the Federal Reserve’s 2011 cap on debit card swipe fees as too high and another legal action that said a record-setting $7.25 billion settlement with banks over credit card swipe fees in 2012 was too low. Both cases went to the U.S. Supreme Court, which let the debit swipe cap stand but returned the credit card case to the trial court for additional proceedings.

Prior to joining NRF, Duncan served as senior counsel in the Washington office of J.C. Penney, where he advised the company on state and federal legislative and regulatory issues. He was previously a senior attorney in the Office of Policy Planning at the Federal Trade Commission, where he wrote the commission’s Policy Guidance on Civil Penalties, and was an associate at the law firm of Sutherland, Asbill and Brennan. The Los Angeles native is a graduate of Pomona College and Yale Law School.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs — 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy.

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

Retailers Urge Congress To Help Save Consumers Billions With Swipe Fee Reform

WASHINGTON, 2017-Apr-29 — /EPR Retail News/ — The National Retail Federation and retailers from across the country went to Capitol Hill today (April 26, 2017) as Congress held a hearing on legislation that would repeal debit card swipe fee reform, telling lawmakers that reform has saved merchants and consumers more than $40 billion and should be protected.

“Debit card reform has been a remarkable success,” NRF Senior Vice President and General Counsel Mallory Duncan said. “It has saved retailers and their customers billions of dollars and it has brought the beginnings of transparency and competition to a market where swipe fees were price-fixed and all banks linked arms to charge the same high fees. If reform is repealed, the big banks will go back to those practices, and nothing will stop them from setting these fees as high as they like and driving up prices paid by consumers in the process.”

“This has been settled law for the better part of a decade,” Duncan said. “We should be looking at the future of payments rather than trying to re-legislate this important consumer protection and vital step forward for fair market competition.”

The House Financial Services Committee is holding a hearing this morning on the Financial Choice Act, legislation sponsored by Chairman Jeb Hensarling, R-Texas, that would repeal debit swipe fee reform as part of a larger rollback of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

No retailers were invited to testify at the hearing despite the issue’s impact on the industry. But dozens of retailers are in Washington today for a fly-in organized by NRF and other retail groups to lobby against repeal and many attended the session. In addition, NRF submitted a statement for the record and is running digital ads and circulating petitions addressing consumer benefits, competition and retailers’ concerns that urge Congress to preserve debit card reform.

This morning, Senate Minority Whip Richard Durbin, D-Ill., the namesake sponsor of debit swipe fee reform in the Senate, and Representative Peter Welch, D-Vt., the measure’s chief backer in the House, spoke before retailers over breakfast.

Debit reform was enacted as part of Dodd-Frank in response to the card industry’s practice of price-fixing the debit card “swipe” fees banks charge merchants to process transactions. The fees previously averaged 1-2 percent of the purchase amount, and virtually all banks that issue cards charged the same.

Under reform regulations that took effect in October 2011, large banks are limited to 22 cents per transaction, down from about 45 cents in the past. The limit saved retailers about $8.5 billion in the first year alone, with close to $6 billion of the savings passed along to consumers, according to a study by economist Robert Shapiro. Banks that set the fees competitively and independently are exempt from the limit, but virtually none have done so. Banks with under $10 billion in assets are also exempt.

The savings has been particularly important to small retailers, who say the fees are among their highest expenses.

A survey conducted for NRF last year found that 89 percent of consumers said the limit should remain in place. In addition, 84 percent said swipe fees should be set on a competitive basis rather than letting card companies set price-fixed fees.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF.com

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

NRF and RILA urges supreme court not to revive controversial 2012 settlement of credit card swipe fees

WASHINGTON, 2017-Feb-23 — /EPR Retail News/ — The National Retail Federation and the Retail Industry Leaders Association today (February 21, 2017) asked the U.S. Supreme Court to let stand an appeals court ruling that struck down a controversial 2012 settlement of a class action lawsuit over Visa and MasterCard’s credit card swipe fees.

“This alleged ‘settlement’ was a backroom deal that would have done nothing to end price fixing or keep swipe fees from soaring in the future,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Even worse, it includes a provision that would keep merchants from ever suing over this issue again. The Circuit Court did the right thing in tossing this case out and it should not be revived. There are ways to bring swipe fees under control but this settlement is not one of them.”

“This is not just a business-to-business dispute,” Duncan said. “These fees drive up the price of retail merchandise, costing the average family hundreds of dollars a year in added expenses.”

The 2nd U.S. Circuit Court of Appeals last year struck down a $7.25 billion antitrust settlement approved by U.S. District Court Judge John Gleeson in a 2005 lawsuit brought by a small group of retailers and trade associations claiming to represent the retail industry.

Gleeson approved the settlement even though NRF and others argued that it failed to reform the price-fixing system under which Visa and MasterCard set fees for credit cards issued by thousands of banks. Rather than lower the fees, the card companies proposed in the settlement that they be passed along to consumers as a surcharge. Major retailers rejected the surcharge proposal, saying it was the opposite of what they sought, while small retailers would have seen as little as a few hundred dollars each. Retailers who rejected the monetary settlement would have still been bound by other restrictions the court would not let them opt out of, including a prohibition on future lawsuits over the fees.

NRF in 2014 asked the 2nd Circuit to overturn the settlement, saying a broad cross section of the retail industry ranging from independent Main Street stores to national chains opposed the deal. The appeals court ruled in NRF’s favor last year, saying that merchants “were inadequately represented” in the case. That ruling, however, has been appealed to the Supreme Court by some of the original plaintiffs.

“The settlement itself achieved nothing important for merchants that accept credit cards, which is why every prominent group that represents merchants has opposed it,” NRF and RILA said in a joint brief filed today with the Supreme Court. “This deal is a bad one, unworthy of resuscitation.”

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. NRF.com

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

NRF calls on U.S. Supreme Court to allow merchants to freely show customers the added costs that come with paying by credit card

WASHINGTON, 2017-Jan-11 — /EPR Retail News/ — The National Retail Federation today called on the U.S. Supreme Court to allow merchants to freely and accurately show customers the added costs that come with paying by credit card rather than cash.

“Retailers have no interest in surcharging their customers for using credit cards,” NRF Senior Vice President and General Counsel Mallory Duncan said. “That would be the opposite of our goal to bring credit card swipe fees under control. But merchants do want to be able to show customers the cost of using a credit card without running afoul of the law.”

“This case isn’t about surcharging,” Duncan said. “It’s about giving retailers freedom of speech when they try to give their customers a break for paying by cash. Some states allow cash discounts but prohibit credit card surcharges. A gas station owner shouldn’t be hauled into court for saying gas is $2.90 a gallon cash and $3 credit rather than saying $3 credit and $2.90 cash.”

Justices are hearing arguments today in a case challenging laws in 10 states that prohibit merchants from imposing a surcharge when customers use a credit card. The laws, which were passed at the urging of the card industry, can be traps for merchants who give a cash discount. The lawsuit before the court argues that the laws violate merchants’ free speech rights under the First Amendment and are unconstitutionally vague under the Due Process Clause of the 14th Amendment.

Banks charge merchants a fee averaging about 2 percent of the transaction amount each time a credit card is used, and a fee of at least 21 cents when debit cards are used. The fees total more than $50 billion a year and drive up costs for consumers because card industry rules effectively require them to be built into the price of merchandise.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF.com

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

NRF: We’re glad to see Visa has recognized that they have crossed the line

WASHINGTON, 2016-Nov-23 — /EPR Retail News/ — The National Retail Federation welcomed Visa’s announcement today (November 22, 2016) that it will no longer use EMV technology and rules to improperly steer debit card transactions to its own processing network following an investigation by the Federal Trade Commission and a ruling by the Federal Reserve.

“We’re glad to see Visa has recognized that they have crossed the line,” NRF Senior Vice President and General Counsel Mallory Duncan said. “It’s a shame it took two federal agencies to make that clear. Now the real question is whether Visa will do the right thing by cleaning up the mess they’ve created.”

Visa said today it would no longer require that consumers using a debit card in Europay MasterCard Visa chip card readers be presented with a screen forcing them to select either “Visa Debit” or “U.S. Debit.” For those who choose Visa Debit, the transaction is routed over an expensive network owned by Visa and the consumer is usually required to use an easily forged signature to approve the transaction. When U.S. Debit is chosen, the transaction goes over the retailer’s choice from up to a dozen competing networks that charge merchants less but provide more protection by allowing the use of a secret, secure Personal Identification Number, or PIN.

NRF and other retail groups wrote to Visa last week, asking the company to stop the practice. NRF contends that the screen steers transactions toward the Visa network, and that the higher fees charged by Visa must be built into the cost of merchandise, ultimately contributing to higher prices paid by consumers.

The Federal Reserve ruled earlier this month that the practice violates a 2010 debit card reform law that says retailers must be allowed to choose between at least two unaffiliated networks to process debit transactions. In addition, Visa disclosed in a filing with the Securities and Exchange Commission that the issue has been under investigation by the FTC since July.

While NRF welcomed today’s move to end the practice, Duncan said Visa should work with merchants and equipment providers to ensure that removal of the screens is not done in a way that voids the certification of retailers’ EMV systems. Under rules unilaterally imposed by the card industry last year, retailers who do not have certified chip card readers are subject to increased liability for fraud if a chip card turns out to be counterfeit, unnecessarily exposing merchants to huge losses.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF.com

Contact:
J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

Source: NRF

NRF urges Congress to reject bill that would both undermine competition and repeal on debit card swipe fees

WASHINGTON, 2016-Sep-14 — /EPR Retail News/ — The National Retail Federation today (September 13, 2016) asked Congress to reject legislation that would both undermine competition and repeal the Federal Reserve’s cap on debit card swipe fees. The proposed bill would unleash new, higher, hidden swipe fees that could more than double without competitive routing options and the cap that are currently in place. Most consumers want the billions of dollars in savings to remain.

“Billions of dollars that retailers have saved under this cap have been passed on to their customers, and the vast majority of consumers surveyed have made it clear that they want those savings to continue,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Repealing this important consumer protection measure would drive up the price of almost everything consumers buy and create an unearned windfall for the nation’s largest banks. Big banks can’t be allowed to take yet another bite out of the consumer spending that drives the nation’s economy.”

The Dodd Frank Law set limits on what big banks could charge if they chose not to compete. Repealing the law would allow banks to raise the fees as high as they want, without fear of competition.  “Swipe fee reform pulled banks’ hand at least part of the way out of consumers’ pockets,” Duncan said. “We can’t let them put it back in again.”

Prior to reform, competition was also being undermined because the banks and their card companies locked processing competitors out of the marketplace. Debit card swipe fee reform reversed that, and as a result, there is now an opening for debit networks who are faster, cheaper, more innovative and certainly safer; for example, they all use PINs. Repeal of these reforms will undo this progress and will drive swipe fees up even higher.

A survey conducted for NRF this summer found that 89 percent of consumers said the reform should remain in place. In addition, 84 percent said swipe fees should be set on a competitive basis rather than letting credit card companies set price-fixed fees charged by virtually all the banks that issue their credit and debit cards.

As part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, debit card swipe fees are limited to a flat fee of 21 cents per transaction, plus 0.05 percent of the purchase price. The House Financial Services Committee is scheduled to begin consideration today of the Financial CHOICE Act, legislation sponsored by Chairman Jeb Hensarling, R-Texas, that would repeal debit swipe fee reform as part of a broader rewrite of Dodd-Frank.

Prior to the cap, banks charged retailers one to two percent of the purchase amount to process debit card transactions, driving up the total amount paid by consumers. That amounted to about 45 cents on the typical debit purchase but could come to several dollars on larger purchases. Without the cap, the typical debit swipe fee would likely go back to the previous 45 cents if not higher, Duncan said.

Retailers have saved about $8.5 billion a year since Dodd-Frank was enacted, and most of the savings has been passed along to consumers, according to a study conducted by noted economist Robert Shapiro.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. nrf.com

Contact:
Robin Roberts
press@nrf.com
(855) NRF-Press

Source: NRF

National Retail Federation: cap on debit card swipe fees should be lowered further

WASHINGTON, 2016-Mar-29 — /EPR Retail News/ — A cap on debit card swipe fees enacted by the Federal Reserve five years ago has helped reduce costs for retailers and consumers but is still higher than intended by Congress and should be lowered, the National Retail Federation said today.

“In most cases, 24 cents per transaction represents a significant savings over the prior non-competitive pricing,” NRF Senior Vice President and General Counsel Mallory Duncan said. “However, it is still substantially higher than issuers’ incremental costs.”

Duncan said the cap “has worked moderately well” but that “additional changes are necessary” if Congress’ goal of swipe fees that are proportional to banks’ costs for processing transactions is to be realized.

Retailers have passed along two-thirds of the $8.5 billion in annual savings to consumers but there would have been more savings to share if the Fed had set the cap at the level expected by lawmakers, Duncan said.

Duncan’s comments came in a letter to the Federal Reserve, which is reviewing the cap under requirements of the federal Paperwork Reduction Act.

Under the Dodd-Frank Consumer Protection and Wall Street Reform Act of 2010, the Federal Reserve was required to adopt regulations that would result in debit swipe fees that were “reasonable and proportional” to the actual cost of processing a transaction. Federal Reserve staff calculated the average cost at 4 cents per transaction and proposed a cap no higher than 12 cents. Nonetheless, after heavy lobbying from banks the Federal Reserve Board of Governors eventually settled on 21 cents plus 0.05 percent of the transaction for fraud recovery and allowed another 1 cent for fraud prevention in most cases. The cap, which applies only to financial institutions with $10 billion or more in assets,  took effect in 2011 and totals about 24 cents on a typical debit card transaction.

While lower than the average of 45 cents before the cap was set, NRF argued that the cap included costs that went beyond those allowed under the legislation and filed suit against the Fed in U.S. District Court in 2011. A judge ruled in NRF’s favor and ordered the Fed to recalculate the cap, but an appeals court overturned the ruling and the U.S. Supreme Court refused to grant NRF’s petition to review the case.

Duncan said the shift of more fraud liability to merchants last fall under the conversion to Europay MasterCard Visa chip-and-signature cards is evidence that the 0.05 percent for fraud recovery “may no longer have a legitimate basis.”

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. NRF.com

J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

NRF welcomed attorneys general’s call to credit card companies on the use of personal identification numbers with the new chip-based credit cards

Letter Calls PIN ‘Gold Standard’ for Card Security

WASHINGTON, 2015-11-18 — /EPR Retail News/ — The National Retail Federation today welcomed a letter sent by nine attorneys general to the nation’s top credit card companies and banks calling for the use of personal identification numbers rather than signatures to approve purchases made with new chip-based credit cards.

“This is further proof that top law enforcement officials and security experts agree that continued reliance on an illegible scrawl isn’t good enough to protect American consumers when the technology of a secret, secure PIN is readily available,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Banks and credit card companies should heed the advice being given them and immediately implement chip-and-PIN. That’s the standard used around the world and U.S. consumers deserve nothing less.”

The request was made in a letter sent today by the attorneys general of Connecticut, Illinois, Maine, Massachusetts, New York, Rhode Island, Vermont, Washington state and the District of Columbia to the chief executives of Visa, MasterCard, American Express, Discover, Bank of America, Capital One Finance Group, Citigroup and J.P. Morgan Chase.

“The chip-and-PIN approach is considered by many to be the gold standard currently for payment card security,” the letter said. “Countries that have implemented chip-and-PIN cards have seen significant reductions in fraudulent transactions.”

Chip-and-PIN is used in approximately 80 countries from Asia to Europe but chip cards being issued in the United States use chip-and-signature instead.

“There can be no doubt that this is a less secure standard since signatures can easily be forged or copied or even ignored,” the attorneys general said. “Unlike signatures, PIN numbers can be changed easily and as frequently as needed by the consumer. Absent this additional protection, your customers and our citizens will be more vulnerable to damaging data breaches. This is something we cannot accept.”

The letter dismissed claims that using a PIN would be burdensome for consumers, noting that consumers already use PINs with debit cards. The attorneys general said they were not seeking legislation requiring PINs but rather calling on card companies and banks to make the change “as good corporate citizens.”

Last month, the Federal Bureau of Investigations issued a warning that said PINs were more secure than signatures, then revised the statement after receiving objections from the banking industry. Last year, President Obama issued an executive order requiring PINs on credit cards issued to government workers.

NRF has argued for years that the new cards should replace fraud-prone signatures with a more secure PIN. While chips make the new cards more difficult to counterfeit than traditional magnetic stripe cards, the chip can be circumvented, and the chips do nothing to protect lost and stolen cards from being used. A PIN could prevent fraud with lost, stolen or counterfeit cards even without a chip.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. nrf.com

J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

SOURCE: National Retail Federation

The National Retail Federation agrees with FBI warning that new chip-based credit cards are safer but need PIN to minimize risk of fraud

WASHINGTON, 2015-10-12 — /EPR Retail News/ — The National Retail Federation today said it agreed with a warning from the FBI that new chip-based credit cards are safer than traditional cards but still vulnerable to fraud and need to be used with a PIN instead of a signature to minimize risk.

“What the FBI is saying is what the rest of the world already sees as common sense,” NRF Senior Vice President and General Counsel Mallory Duncan said. “It’s the right thing to do, and we hope the banks are listening.”

“Retailers are determined to protect their customers,” Duncan said. “That’s why we are pushing the banks to use all of the security the new cards are capable of providing, not just half. They shouldn’t lock the front door but leave the back door wide open.”

In a warning issued on Thursday to consumers, merchants and law enforcement, the FBI praised Europay MasterCard Visa chip cards as being more secure than traditional magnetic stripe cards, but said they are “still vulnerable to fraud.” Despite card industry claims that the chips are difficult to counterfeit, the FBI said the cards “can be counterfeited using stolen card data obtained from the black market.” The bureau also said the chip “will not likely” stop stolen or counterfeit cards from being used online or in telephone purchases.

“When using the EMV card at a point-of-sale terminal, consumers should use the PIN instead of a signature,” the FBI said. “This fully utilizes the security features built within the EMV card.”

The FBI encouraged merchants to require that consumers use a PIN rather than signature, and said merchants should ask for a government-issued photo identification card when customers use a signature.

Despite the FBI warning, virtually all of the chip cards being issued in the United States are chip-and-signature rather than chip-and-PIN, leaving consumers without the option to use a PIN. By contrast, EMV cards used in 80 countries around the world for 20 years or more are routinely chip-and-PIN.

“They’re encouraging consumers to use PIN and they’re encouraging merchants to request PIN – the only thing missing is to encourage the banks to issue PIN cards,” Duncan said.

The FBI warning follows last week’s deadline for merchants to install chip-card readers or face increased fraud liability if a chip card is used in a non-chip reader. The warning is the second time that the federal government has come down in favor of PIN – President Obama last year signed an executive order requiring that credit cards issued to federal government workers have a PIN, and that federal facilities that accept credit cards be equipped for PIN.

NRF has argued for years that the new cards should have both a chip and a secret PIN, or personal identification number, saying that the combination of both is required to provide sufficient security. While chips make the new cards more difficult to counterfeit, the chip can be circumvented, and the chips do nothing to protect lost and stolen cards from being used. A PIN could prevent all of those types of fraud, even without the chip.

NRF has provided a variety of resources explaining the advantages of PIN cards on its data security web page. NRF submitted testimony to a congressional committee on Wednesday arguing in favor of PIN over signature.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. nrf.com

J. Craig Shearman

(202) 626-8134
press@nrf.com
(855) NRF-Press

Congress needs to pass a strong and effective federal data breach notification law, National Retail Federation

NRF Concerned over ‘Notice Holes,’ Wants ‘Everyone to Have Skin in the Game’

WASHINGTON, 2015-3-19 — /EPR Retail News/ — Congress needs to pass a strong and effective federal data breach notification law that applies to all entities that handle sensitive customer data, the National Retail Federation said today before a congressional panel examining draft data security legislation.

“If Americans are to be adequately protected and informed, federal legislation to address these threats must cover all of the types of entities that handle sensitive personal information,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Exemptions for particular industry sectors not only ignore the scope of the problem, but create risks criminals can exploit. Equally important, a single federal law applying to all breached entities would ensure clear, concise and consistent notices to all affected consumers regardless of where they live or where the breach occurs.”

Duncan testified before a hearing of the House Energy and Commerce Committee’s Subcommittee on Commerce, Manufacturing and Trade, which was examining the Data Security and Breach Notification Act of 2015, proposed by Representatives Marsha Blackburn, R-Tenn. and Peter Welch, D-Vt.

Duncan outlined three principles for a federal data breach notification law, saying such a measure must apply to all entities handling sensitive information, including cloud services companies, payment processors, telecommunications firms, and branded payment networks; must reflect a strong consensus of existing state laws; and must preempt state laws in order to establish a truly uniform nationwide standard.

The draft legislation before the subcommittee would require neither third parties, like cloud-based storage services, that handle sensitive data for ‘covered entities,’ nor ‘service providers,’ such as communications firms, from providing public notice of their breaches of security. The bill would, however, place new data security and notice requirements on a broad swath of other industry sectors subject to Federal Trade Commission jurisdiction, such as retailers, restaurants, hotels, grocery stores, convenience stores, gas stations, and other merchants.

“Congress should not allow a federal breach notification law to suffer from ‘notice holes’ – the situation where certain entities are exempt from publicly reporting known breaches of their own systems,” Duncan said. “If we want meaningful incentives to increase security, everyone needs to have skin in the game.”

What retailers want you to know about data security from NRF on SlideShare

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. www.nrf.com

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Stephen E. Schatz
202-626-8119
press@nrf.com
(855) NRF-Press

The National Retail Federation expressed disappointment at the U.S. Supreme Court’s ruling on swipe fees

WASHINGTON, 2015-1-21 — /EPR Retail News/ — The National Retail Federation today expressed disappointment at the U.S. Supreme Court’s announcement that it would not review an appellate court ruling on whether the Federal Reserve set a 2011 cap on debit card swipe fees higher than the level sought by Congress in legislation passed the year before.

“The court’s decision is disappointing because it leaves merchants and their customers paying far more than intended by Congress,” NRF Senior Vice President and General Counsel Mallory Duncan said. “Federal agencies have flexibility in implementing our nation’s laws, but do not have the discretion to blatantly ignore the wishes of elected officials and the clear language of the statute. The court’s ruling means retailers will keep paying billions of dollars more than they should, and that fee-hungry banks will continue to rake in unearned profits that ultimately come out of consumers’ pockets. We will continue to press the issue.”

“Banks will benefit from this ruling but the battle over swipe fees isn’t over,” Duncan said. “There is still litigation pending on credit card swipe fees, and policymakers continue to be concerned by the anti-consumer and anti-competitive practices of the card industry.”

The court today turned down a petition asking the justices to review the case. The petition was filed in August by NRF, the National Association of Convenience Stores, the Food Marketing Institute, the National Restaurant Association, NRF member Boscov’s Department Store, and NACS member Miller Oil Co., all of whom were plaintiffs in the original lawsuit.

Under the Dodd-Frank Consumer Protection and Wall Street Reform Act of 2010, the Federal Reserve was required to adopt regulations that would result in debit swipe fees that were “reasonable and proportional” to the actual cost of processing a transaction. Incremental costs of authorizing, clearing and settling each transaction were allowed to be considered but fixed costs were not. Federal Reserve staff calculated the average incremental cost at 4 cents per transaction and initially proposed a cap no higher than 12 cents, but the Federal Reserve Board of Governors eventually settled on 21 cents after heavy lobbying from the financial services industry.

While lower than the average of 45 cents before the cap was set, NRF argued that the 21-cent figure included costs that went beyond those allowed under the legislation and filed suit against the Fed in U.S. District Court in 2011 along with other retail groups. In July 2013, Judge Richard Leon ruled in NRF’s favor and ordered the Fed to recalculate the cap at a lower level, but the Fed appealed. In March 2014, the U.S. Court of Appeals for the District of Columbia overturned Leon’s ruling, citing “ambiguity” in the 2010 law and saying the Fed based the cap on a “reasonable interpretation” of the measure.

Last August’s petition argued that the Circuit Court made a number of legal errors and “bent over backward to find ambiguity” in Dodd-Frank while ignoring the ‘text, structure and purpose” of the law.

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. www.nrf.com

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J. Craig Shearman
(202) 626-8134
press@nrf.com
(855) NRF-Press

The National Retail Federation’s statement regarding retailers’ adoption of mobile payment platforms and services

WASHINGTON, 2014-10-28— /EPR Retail News/ — The National Retail Federation today issued the following statement from Senior Vice President and General Counsel Mallory Duncan regarding retailers’ adoption of mobile payment platforms and services:

“Merchants large and small make business decisions every single day based upon what makes the best sense for the business, their associates and most importantly, their customers. The payment systems they decide to implement are no different. Data security is paramount, but so is flexibility, cost and ease of use.

“There are a number of new technologies reaching the marketplace, and a number of other systems on the horizon. It is easy to second guess why a specific retailer chooses one technology or another, or what payments they will or will not accept, but you can be sure that the bottom line consideration is what is best for their company and their consumer.”

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. www.nrf.com

Stephen E Schatz
202-626-8119
press@nrf.com
(855) NRF-Press

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