November 10 2008 by Ellen Roseman
Canadian credit card issuers are moving to a new security system. By 2010, you will have to use a four-digit password to validate a credit card sale in a store or restaurant.
The problem is this: Who’s responsible for credit card fraud or unauthorized transactions?
Visa, MasterCard and American Express have zero liability policies for credit card users. They say this will continue.
But some Visa card issuers are sending new terms and conditions to cardholders. They’re saying you may be held responsible if it appears you have not taken care of your personal identification number (PIN).
This is worrisome, since it’s eroding your rights. There are no laws or voluntary codes to say how the credit card issuers will decide who’s right and who’s wrong in these cases.
If such an important issue is still up in the air, why are the banks sending out chip and PIN cards already? And why are they sending out unilateral changes in card terms and conditions?
The banks are reluctant to respond when I ask them. They defer to Visa and MasterCard, who say the zero liability policy will stay. But Visa and MasterCard don’t deal with customers. Only financial institutions deal with customers.