President Obama’s New “BuySecure” Executive Order Summary

On October 17th, President Obama signed a new Executive Order called the BuySecure initiative. The aim of BuySecure is to help securing transactions and sensitive data in light of all the recent data breaches. When announcing this new intiative President Obama said:

When buying the things you need without risking your identity, your credit score or your savings.

You can view the speech Obama made at the CFPB headquarters by viewing this C-Span video (warning: ~16 minutes long). We’ve also outlined the major announcements below:

• Citibank will offer consumers access to their FICO score for free. Score will be updated monthly and is based on a consumers Equifax credit report. This will be introduced from January, 2015 onwards.
• All government issued credit or debit cards and card readers will come equipped with an EMV chip and PIN functionality. This will be introduced starting January, 2015
• Federal law enforcement will share more information with the private sector when they discover identity theft rings
• FTC will add new features to identitytheft.gov (currently redirects to http://www.consumer.ftc.gov/features/feature-0014-identity-theft). FTC will also work more closely with credit bureaus to dramatically reduce the amount of time it takes a consumer to recover their stolen identity
• President Obama will bring together consumer advocates and industry specials for a cyber security summit
• Home Depot, Target, Walgreens & Walmart have pledged to adopt PIN & Chip technology
• American Express has pledged $10,000,000 to help replace outdated card readers for small businesses
• MasterCard has pledge to provide it’s cardholders with free identity theft monitoring and resolution support

Our Thoughts

It’s great to see a Government leading by example. Hopefully this puts pressure on all three of the major credit card processors to speed up their time line for making Chip + PIN cards mandatory, one interesting fact that Obama mentioned is that when Britain introduced Chip + PIN they saw fraud rates drop in store by 70%.

It’s also great to see that card issuers are starting to realize that they need to offer a free FICO score as a standard benefit, rather than a unique selling point. Chase & Bank of America are also considering offering these scores for free and I believe Capital One will make a change to their credit tracker tool in the near future (although I’m unsure if this will provide consumers with a different FAKO score to what they currently offer or a FICO score).

All in all these are extremely positive changes. My only criticism is that it’s taken too long for some businesses to make these changes. Chip + PIN technology should already be the standard and required on all credit, debit and card terminals. Recovering your identity and removing fraudulent items from your credit report shouldn’t take 30+ days. It’s a shame that it’s taken so many seperate and large data breaches for policy makers and the President to realize how serious these issues are.