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<DIV><FONT face=Arial size=2><A
href="http://www.businessweek.com/ap/financialnews/D8LPMID00.htm">http://www.businessweek.com/ap/financialnews/D8LPMID00.htm</A></FONT></DIV>
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<H1>NY Sen. Schumer warns of no-swipe cards</H1>
<P class=byline>By KAREN MATTHEWS</P>
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<DIV class=module id=relatedItems>No-swipe credit cards that use radio waves to
relay their data put consumers at increased risk of identity theft, Sen. Charles
Schumer said Sunday.</DIV></DIV></DIV>
<P>"These cards may be convenient, but they're a double-edged sword," said
Schumer, D-N.Y.</P>
<P>Tens of millions of no-swipe credit cards have been issued in the past year.
When a customer uses the credit card to make a purchase, the card is processed
by a radio frequency identification reader operated by the retailer.</P>
<P>Schumer said thieves can equip themselves with the radio frequency readers to
steal information from the credit cards, which are being marketed heavily as
time savers.</P>
<P>"All you need to be is within a couple of feet of the customer," Schumer
said. "You may as well put your credit card information on a big sign on your
back."</P>
<P>But JPMorgan Chase & Co., the nation's second-largest financial services
provider and its premier credit card issuer, has maintained the no-swipe method
provides the same level of security as the traditional swiping method, which
involves reading a magnetic strip on the back of the card. The cards use
encrypted data, it said.</P>
<P>"The card and the reader in the terminal are safe and secure, and the
transaction is handled the same way that credit cards are managed today," Thomas
O'Donnell, senior vice president of Chase cards services, said when the company
announced the launch of its blink cards last year.</P>
<P>Schumer, who held a news conference on a busy Manhattan street corner Sunday
amid holiday shoppers, called for regulations to require higher encryption
standards that would make the cards more secure.</P>
<P>In addition, Schumer said contracts for the no-swipe credit cards should have
warning boxes disclosing "the known weaknesses of the technology."</P>
<P>"Holiday shoppers need to be extremely careful with their credit cards," he
said, "and these companies need to step up their efforts to protect people from
identity theft."</P>
<P>A telephone call to Visa International Inc., the nation's largest credit card
brand, wasn't immediately returned.</P></DIV></BODY></HTML>