Recently, there has been a lot of discussion around the new Europay, Mastercard, and Visa (EMV) technology as the October liability shift looms away from magnetic stripe and signature cards takes place.  Through all of the discussion, there have been a lot of misstatements made by financial institutions regarding “chip-and-PIN” technology.

As a former law enforcement official myself, I was disappointed to read deliberately misleading comments coming from a former Federal Bureau of Investigation (FBI) official in a recent op-ed where it was stated that “fraud reductions provided by PIN appear to be fleeting and ultimately illusory.”


There are many benefits to “chip-and-PIN” technology, but the most significant benefit is that this technology has shown its fraud-fighting prowess around the world and in nearly every G-20 nation.

The United States has lagged behind many countries in adopting this fraud-reducing technology.  And while other nations have protected themselves and their citizens, cyber-crime has migrated to the United States due to the fact we employ technology from the 1960s in our card payment process.

While it is an important first step to issue cards with chips – which supplant the outdated magnetic strip – the easy to forge signature needs to be replaced with a personal identification number (PIN) in order to provide the highest level of security to consumers. 

“Chip-and-PIN” cards have proven effective at cutting fraud and polling shows that more than 80 percent of Americans are ready for the technology.  In fact, according to the Federal Reserve, using a PIN in debit card transactions has reduced fraud by 700 percent. 

It is no secret that retailers have been the ones leading this transition, investing billions to implement new chip-enabled card readers in stores nationwide.  Retailers are investing in infrastructure for a safer payment ecosystem because the technology has proven extremely effective in reducing fraud.  But chip-enabled cards, without the supplementing PIN, leave consumers without a level of security and protection they want and deserve.

Everybody is impacted by cyber-crime, a reminder that attacks pose harm to any institution or company that accept card payments.  This is why it is essential that the financial industry work to provide consumers with the best technology available to combat fraud and prevent breaches.  They need to join in the collaborative effort and embrace 21st Century “chip-and-PIN” cards, and stop issuing misleading attacks. 

It’s no coincidence that the federal government under President Obama has decided to adopt “chip-and-PIN cards” and its time every American have that same security.  The current refusal of financial institutions to invest in “chip-and-PIN” technology in the United States has made all industries in the card payment ecosystem a tempting target for cyber-attacks.  And it’s time we do something about it and honest discussion is the first step.

Coakley is the former attorney general of Massachusetts.