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FTC to Audit PCI Industry March 9, 2016

Posted by Chris Mark in Uncategorized.
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ftc_logo_430(UPDATED) I have been in the PCI “industry” since before it was an industry.  I was fortunate to have worked with Visa in 2001 on a team that helped design the CISP requirements for Service providers and subsequently worked at MasterCard a major processor and numerous QSA firms.  I can claim (along with 2 or 3 other people) to be the FIRST assessor even before we were QDSPs then QSAs. I was the PCI SSC’s global QSA trainer and Visa’s CISP trainer.  There probably only 10 people in the industry that have been doing “PCI” type work as long as I have.  Unfortunately, we lost two of those fine folks in the last several years.  One of the most frustrating aspects of being in the PCI assessment business has been competing with the “pay and stamp” assessors.  PCI is complex and conducting a solid PCI assessment is complex and not trivial. There have always been the “bottom feeders” that will guarantee a compliant finding for a nominal  fixed price fee.  For those companies that do solid work (while I compete with them I am also friends with many and can respect their work as much as my own employers) we often find ourselves on the losing end of a bid when someone agrees to assess a Fortune 100 company for a Fixed fee of $40K.  Well..the Federal Trade Commission has taken notice!

The FTC has issued an order to 9 QSA firms to assess (pun intended) how they assess companies against the PCI DSS and how their business is structured. The 9 companies listed are:

Foresite MSP, LLC; Freed Maxick CPAs, P.C.; GuidePoint Security, LLC; Mandiant; NDB LLP; PricewaterhouseCoopers LLP; SecurityMetrics; Sword and Shield Enterprise Security, Inc.; and Verizon Enterprise Solutions (also known as CyberTrust).

Here is my beef with that list.  The one company (to remain un-named for fear of a lawsuit..but we all know who it is)..that has had 7 or so of the largest credit card breaches in history as it’s clients is not listed.  3 of the companies are ‘newbys’ and 3 are very well known and respected companies.  They should have asked for “Chris’ list” 😉

After reading the order it is clear the FTC has done their homework and knows the answers they expect to get.  This is not simply smoke and mirrors.  They are asking questions related to:

  1. The bidding process for QSA work
  2. Cost structure of PCI assessment work
  3. Time associated with the average assessment
  4. number of companies found ‘non compliant’
  5. Whether a company is found ‘compliant’ BEFORE completing all work.
  6. Sampling methodology (this is a gotcha because the required methodology is outlined in the training)
  7. Qualifications

They are then asking for a sample ROC to be provided.  I cannot applaud the FTC enough for taking this step.  It is well past time that we get the “pay and stamp” providers  out of the industry! Read the Order Here!


1. John Markh - March 10, 2016

It could be that the FTC list of QSA companies contains both newbies, well respected and what they perceive as “rubber stumping” organizations is to have a comparison or a baseline to compare against.

I mean, you can not simply take the “company (to remain un-named for fear of a lawsuit..but we all know who it is)..that has had 7 or so of the largest credit card breaches in history as it’s clients is not listed” and others in the same category as the FTC investigation will simply confirm that all firms have similar modus operandi and everytjing is Kosher.

2. Eric Dow - March 11, 2016

I agree completely, but there also needs to be some thought given to the small business as well. The percentage fees I pay as a small retailer, and the small profit margins I get do not allow me to pay a large sum for things like PCI compliance. If you eliminate the lower cost alternatives, and my fees go up, do I just stop taking Visa/MC?

3. David Mark - March 13, 2016

Hold on. You worked for Visa. You worked for MasterCard. Ummm, sorry brother, but taking a paycheck from them makes u a bottom feeder too. You sold your soul to companies like that?? What? For a paycheck? I’m saddened a fellow Devil Dog would do that.

Chris Mark - March 13, 2016

The fact that you would use “Devil Dog” shows you were little more than a POG and you are far from my ‘Marine Brother’ as any civilian could be. “Taking a paycheck”? I don’t talk to POGs unless I am asking them for something. So…get your shinebox, clown.

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