Current State of Play in Washington, DC

September 17, 2014

ETA CONTINUES TO OPPOSE OPERATION CHOKE POINT (OCP)
ETA has continued its effort to push back in Washington against Operation Choke Point (OCP), an effort by federal regulators and the Department of Justice to try and hold banks and processors responsible for illegal or fraudulent acts by a merchant or ISO. The payments industry is opposed to this broad approach because is it over-inclusive, targeting banks and processors who are simply engaged in the act of processing.

ETA recently testified before Congress about the harmful effects of OCP, offering  the ETA’s Guidelines on Merchant and ISO Underwriting and Risk Monitoring as an example of a better solution to fighting fraud. Our lobbying team has met with numerous policymakers Congressional offices and federal regulators. The ETA’s grassroots effort, The Voice of Payments™, was utilized by 250 ETA executives to sign a petition to Members of Congress in opposition to OCP. 

DATA SECURITY STALLED
Months after the highly publicized data breaches at Target, Neiman Marcus and other retailers, Congress is at an impasse on the myriad of proposals introduced on data security. After numerous hearings early in the year in both the House and Senate, neither chamber has been able to move a proposal out of committee. However, it is still important for the payments industry to continue to weigh in and let Congress know that a national standard on breach notification is critical.

CFPB’s MOBILE INQUIRY
In June, the Consumer Financial Protection Bureau (CFPB) launched an inquiry to find out how consumers are using mobile financial services. The CFPB is keenly interested in what role mobile can play in providing services to unbanked and under served consumers who may have limited access to traditional banking systems.

The CFPB inquiry is broad and seeks information from interested parties on variety of issues including how consumers currently use mobile technologies to access financial services. In addition, the inquiry seeks information on matters dealing with privacy and data security. Finally, the CFPB is also examining whether data breaches are more common on mobile devices as compared to online financial services.

The ETA is working with our members to prepare a comment letter that will provide our views to the agency as to the vital role the burgeoning mobile arena can play in providing secure, convenient and  affordable services to all consumers.

FACIAL RECOGNITION
The use of facial recognition technology is expanding and gaining popularity as a means of reducing fraud. However, this innovative technology raises important privacy questions that address how biometric data is being collected and stored.

The Department of Commerce’s National Telecommunications and Information Administration has convened a privacy multi-stakeholder process regarding the commercial use of facial recognition technology. The goal of this process is to develop a voluntary, enforceable code of conduct that will craft privacy safeguards for the commercial use of facial recognition technology. ETA has formed a working group to examine the issue.

INDUSTRY INVOLVEMENT
So how do we, as an industry, let policymakers know our position on the various issues facing the industry?

ETA members are encouraged to establish or strengthen relationships with lawmakers in their state or district. We encourage you to use the August recess to schedule a meeting at your work site so policy makers can see how your organization operates and the processes you have in place for facilitating commerce while protecting consumers.

Please contact me at [email protected] for more information.