Subject: Fwd: EMV is coming--we're gearing up!
From: "Adam J. Levitin" <[email-masked]>
To: Law Faculty and Visitors <[email-masked]>
Date: Mon, 19 Oct 2015 21:41:05 +0000

Hi colleagues,

The EMV technology issue is a controversial one, and one I’ve been involved in for some time.  At the risk of being a nudnik, I think it’s important to clear up some misconceptions reflected in the email below.

Here’s the story in seven bullet points:

  *   EMV technology means that there is a microchip in your credit or debit card.  The point of the chip is to make it more difficult to counterfeit physical cards because now one has to also counterfeit a microchip.  EMV has been in use in most of the world for some time, but the US has been slow to adopt it.  (I’ve written about why here<http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1570867>.)
  *   The EMV chip works with an EMV card reader.  Without the reader, the chip is useless, and vice-versa.
  *   There is no legal requirement whatsoever to use EMV.  EMV is not required “to be compliant with new banking requirements and US credit card security regulations.”  In fact, there are no US credit card security regulations of any sort, and anti-money laundering regulations do not require EMV.
  *   Rather, the credit card networks have adopted a fraud liability shift rule to encourage adoption of the technology.  Previously the card issuer was liable for fraud that occurred when a physical card was presented (“card present fraud”), assuming the merchant did everything it was supposed to do.  Now, the merchant will be liable for card present fraud if there is an EMV card and an EMV reader is not used.    If the card is not EMV equipped, the old rule (issuer liable) applies, and the issuer is also liable if there is an EMV card and an EMV reader is used.
  *   EMV technology has no effect on consumer liability.  You have at most $50 of liability for unauthorized credit card purchases.  Debit card liability is more complex.  It can be $50, $250, or unlimited, if you are negligent and never notify the card issuer of the unauthorized transactions.
  *   EMV technology does nothing to prevent card-not-present fraud, like fraudulent internet purchases.
  *   Whether a merchant should invest in EMV card readers should be a function of whether the increased fraud liability outweighs the sunk cost of the readers and the slower (or lost) transactions.
  *   Given that card-present fraud is typically a problem for merchants who sell larger items, and is more costly for merchants who have long-lines (like quick-serve restaurants and cafeterias) I’m rather surprised that any of the G’town merchants are bothering with the technology.

Best,

Adam

Begin forwarded message:

From: Leslie de Leon <[email-masked]<mailto:[email-masked]>>
Subject: EMV is coming--we're gearing up!
Date: October 19, 2015 at 4:54:14 PM EDT
To: Announcements <[email-masked]<mailto:[email-masked]>>, All Students <[email-masked]<mailto:[email-masked]>>

Dear All,

Many of you have probably already heard about the migration of the U.S. payment systems to EMV - Europay MasterCard Visa (aka, the chip card). As with many new systems (well, new to the US anyways), this EMV transition hasn’t come without its glitches—and, we’re sorry.
For example, this morning’s credit card malfunction in the Market Café and Sweet Yo was EMV related. Again, we apologize for the frustration, but please know that we’re working collaboratively with our external partners to fix and improve from these experiences.

So, what does this mean for GULC?
In a nutshell, all departments that currently take credit cards as a form of payment—Sweet Yo, Subway, the Market Cafe, etc.—must switch over to EMV to be compliant with new banking requirements and US credit card security regulations. We’ve been working behind the scenes to prepare for this transition, by purchasing new credit card readers, learning how to use new hardware and software, and spending way too much time learning about different kinds of data connections.
What to expect in the next few weeks?
Because of the added security measures and configuration changes, it takes a little longer to complete EMV purchase transactions. Unfortunately, thismight mean having to wait a little longer at the check-out lines.

We need your help!
Please be patient with Ms. Betty, Ms. Karen and all other check-out associates. They’re working hard to implement these new policies for everyone’s financial security. Any potential delays are often systematic and can’t be avoided or solved by the check-out folks (on campus and at other stores).

Have suggestions or concerns?
Some of the best solutions to our challenges have come directly from students and our Law Center community. Please email me [email-masked]<mailto:[email-masked]> with any questions, concerns, or suggestions. Just in case all this EMV talk is new to you, here’s<http://money.usnews.com/money/personal-finance/articles/2014/10/28/coming-next-fall-more-chip-and-pin-cards-in-the-us> an article with more information about the EMV transition.

Thank you!
Leslie

Leslie de Leon
Director, Business Services
Georgetown Law
600 New Jersey Avenue NW Suite 517
Washington, DC 20001
Tel: 202-661-6553
Email: [email-masked]<https://mail.law.georgetown.edu/owa/redir.aspx?C=BE9Nu7YtN0i316uhp3NzY47iTPB-rNEIpmgXkrRxshLAvkKBs60pROEFZbEwaxPB9H5W8CklufA.&URL=mailto%3ald333%40law.georgetown.edu>