District Attorney advises consumers about new 'chip and pin' technology for credit cards

SAN DIEGO COUNTY – San Diego County District Attorney Bonnie Dumanis has issued a warning to consumers that old credit card technology has left people more susceptible to identify theft.

The magnetic strip technology on the back of credit cards has been around since the 1970s. This old technology is easier for scammers to steal and sell cardholder personal information.

New 'chip and pin' technology, in which a computer chip is embedded in credit cards, keeps personal information more secure because it is encrypted.

Last year, there were record-high 783 data breaches that exposed more than 10 million consumer records containing personal identifying information, according to the Identity Theft Resource Center. The Federal Trade Commission reported 332,646 complaints of identity theft across the United States for that same period. Last year, the District Attorney’s Office prosecuted 894 cases of identity theft in San Diego County.

"Consumers should be aware of the latest technologies available to help them protect their identities and their financial wellbeing," Dumanis said. "If your credit card isn’t updated with the chip technology, consider contacting your bank or credit card company to request a new card."

The chip in the newer credit card is a microchip that activates when the pay terminal sensor detects it. The chip contains a cryptographic key that allows a one-time use of the card, because it generates a unique key for that transaction. This way, if the stored information on the point of sale terminal is breached, the card number can’t be used again for another transaction because it has the unique key embedded in it. The technology is presently in use in Europe and it dramatically reduced identity theft there.

Pin and chip (or EMV) is becoming increasingly common and the expectations are that by the end of the year, all the major retailers will have switched. Transactions where the physical card is not present, such as online transactions, will still have vulnerabilities that the chip and pin technology can do nothing about.

To get a pin and chip card, a consumer can request a replacement from the respective financial institution. Most major banks have shifted over and are replacing cards as the old ones come up for replacement. Many smaller credit unions have not switched over yet, but they likely will by the end of the year.