With Canada completing the move from magnetic stripes to smart cards by the end of 2010, they are beginning their "Smart Card's Are Safer" Campaign. Here's a story from the Vancouver Sun pointing out that if you use smart cards, then you won't ever have to buy $10,000 worth of TV's in Memphis...
How smart is the smart chip?
By Eric Lam, Financial PostJune 16, 2009
With credit and debit card fraud on the rise, Canadian issuers and banks are switching to more secure smartchips in place of the vulnerable magnetic stripe. But, according to experts, the chip is no guarantee of a fraud-free world.
Last year, when Bruce Cran went to Europe, he had all kinds of trouble with his Canadian credit cards. Cashiers in shops and restaurants everywhere gave him funny looks because his card was the old-fashioned kind: No space-age microchips, just a magnetic stripe. Still, they took his card and Mr. Cran, head of the Consumers' Association of Canada, went home without a care in the world.
That changed when he tried to get into an Ottawa hotel room 10 days later."Someone tried to purchase $10,000 worth of TVs in Memphis, Tenn. using my card," he said with a chuckle. "I just couldn't believe it."Mr. Cran managed to get a room using another card, but it took him a day to find out what actually happened and another two weeks to get a new card. He does not know whether the crooks who nabbed his card number, probably when he handed it over at a Parisian outdoor cafe, managed to get away with the Sony TVs."If it had been a chip card, they couldn't have done it," he said.Mr. Cran's story is the kind of cautionary tale that Canadian banks and credit card companies are looking for as they move to the next generation smartchip credit card. Many people already have one, and the industry expects complete market adoption by 2010.
The new cards are meant to curb credit card fraud by encrypting account information on a microchip protected by a personal identification number (PIN). Instead of signing receipts, consumers enter a PIN to validate a transaction.
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