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Green Team October 16, 2006 Product: Customizable Credit Card Protection (C 3 P)

Feasibility Presentation. Green Team October 16, 2006 Product: Customizable Credit Card Protection (C 3 P). Organization Chart. This family received food stamps. www.co.kern.ca.us/dhs/images/0987.jpg. This family received money from FEMA. www.katrinapictures.blogspot.com/.

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Green Team October 16, 2006 Product: Customizable Credit Card Protection (C 3 P)

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  1. Feasibility Presentation Green Team October 16, 2006 Product: Customizable Credit Card Protection (C3 P)

  2. Organization Chart Green Team

  3. This family received food stamps www.co.kern.ca.us/dhs/images/0987.jpg Green Team

  4. This family received money from FEMA www.katrinapictures.blogspot.com/ Green Team

  5. This family received both http://www.spasearch.org/admin/images/fld_main_photo/fld_main_photo_38.jpg Green Team

  6. What do these families have in common? • All these families received Government money • The first two used the money as intended • The third is guilty of spending government money on things other than the intended purpose Green Team

  7. FEMA Fraud • Hurricane Katrina victims • 900,000 of 2.5 Million aid applicants were fraudulent* * http://www.msnbc.msn.com/id/11326973/ Green Team

  8. Problem Statement Government organizations and private businesses have inadequate protection against unauthorized purchases by authorized cardholders, which results in a loss of funds. Green Team

  9. Problem Analysis • Out of a $2.5 trillion government budget** • $14 billion was spent on private purchases by employees • $2 billion was spent on unauthorized purchases by employees* * Foiling credit card fraud by Jenny C. McCune • Bankrate.com ** http://www.gpoaccess.gov/usbudget/ Green Team

  10. Problem Characteristics • Tracking physical receipts • Archaic • Inaccurate • Unreliable • Easy to lose • Employees produced 20% of all transaction receipts* • Cards can be stolen • Organization loses money • Money spent unwisely by an authorized user of the card is not covered under fraud protection * http://www.dallasnews.com Green Team

  11. Solution Characteristics • Prevention of lost corporate funds • Reduces personal, unwarranted spending • Biometrics • Prevents unauthorized use • Uses customizable database • Allows different business to have different options Green Team

  12. C3 Protection Card • So what is C3P? – Customizable Credit Card Protection Green Team

  13. Objectives • Develop a customizable credit card system to prevent unauthorized purchases by employees • Customizable database to hold prohibited purchases • GUI to allow customization of database • Uses Merchant Commercial Codes (MCCs) • Use Universal Product Codes (UPCs) • Implement latest security technology for card protection Green Team

  14. Features • Secure Credit card • 128-bit DES encryption • Biometrics • Fingerprint • Photo ID • Allows customizable control over card’s use • Controlled by a user interface to each business’ personal database Green Team

  15. Customers • Hard Customers • Visa • MasterCard • Discover • American Express • Soft Customers • Every business that holds a business credit card • Caring and concerned parents who issue credit cards to their children Green Team

  16. Customer Characteristics • Credit Card Companies • Spend millions each year on securing their credit cards* • Minors are Credit Card Company’s new target consumer** • Credit Card Company’s Consumers • Small businesses report billions of dollars in losses through embezzlement each year*** • Parents are concerned with giving children control of a credit card yet are even more concerned about giving a child real cash** • * http://news.com.com/Retailers+feel+security+heat/2100-7349_3-5680788.html • ** http://www.bankrate.com/fox/news/cc/20000508.asp • *** http://www.fbi.gov/publications/financial/fcs_report052005/fcs_report052005.htm Green Team

  17. Why does the customer need this? • Soft customer • Secure and efficient control of company funds • Reduced costs to prevent and lesson the effects of fraud • Parental control of children's spending • Hard Customer • Offer safer card services to credit users • Larger customer base • Increase of large, reliable customers Green Team

  18. Major Functional Component Diagram Green Team

  19. RFID Card Specifications • An embedded antenna that is attached to the chip is used to transfer information stored in the chip's memory • The range of operation is 2.5" to 3.9“ • Information can be written to the card the same way it is read. • The fingerprint scanner can be added Green Team

  20. Software Features • Intuitive web-based GUI Interface • Able to customize MCCs and/or UPCs by creating an ‘acceptance’ list • Able to analyze and graph employee spending habits • Incoming UPCs and MCCS are compared with an ‘acceptable’ database of allowed codes Green Team

  21. Receipt Tracking • For each business, all employee purchases are tracked and listed by employee • Receipts will list accepted and rejected purchases • Receipts can be grouped by purchaser, date, and/or MCC Green Team

  22. Smart Card Setup • User account access information added to smart card memory by C3P • 1st user finger scan saves a three-dimensional electrical image of the fingerprint's unique pattern using small variations in finger surface capacitance. Green Team

  23. Authentication Process Current Process NEW Process Vendor must take the credit card and ID from customer Hold your thumb over the fingerprint scanner to prove your identity. Then vendor must authenticate the customer by judgment alone. If your fingerprint matches, the Smart Card & RFID chip will be activated Touch the card to the card reader and the transaction will be processed. If the customer matches the identification, the transaction is made. Green Team

  24. Payment Process Current Process NEW Process You swipe your card at the point-of-sale register. Vendor swipes your card at the point-of-sale register. Your data is sent to our servers for verification. The data is sent to a computer to verify your credit. Your data is then sent to the credit servers to verify. If you have the funds, your purchase is allowed. If your card is accepted and your purchases are valid, sale is complete. Green Team

  25. Authentication code for website • Website URL (holds database) • Requirements for submission of pictures and info Credit card customer information What’s in the Box? What’s Not In The Box Loading Station What’s In The Box What’s In The Box Businesses IF REQUESTED: Computer with Internet connection Credit Card Companies Green Team

  26. c. Send notification of request d. Sell camera (opt.) & authentication code Business C3P makes RFID smart cards w/ biometrics g. Sell cards with C3P (RFID chip/C3P logo/biometrics Flow of Information/Hardware a. Request CC w/C3P b1. Camera? How many cards? b2. Reply e. Send camera (opt.) & authentication code Business accesses C3P database online f. Send photos h. Send cards with CC logo & photo ID Green Team

  27. What this product does not do • Provide point-of-sale RFID readers • Protect against blocking of authorized purchases • Will mostly be a result of human error • Will decrease in occurrence as more businesses use product • Provide credit for businesses Green Team

  28. Competition Matrix Uses existing card readers Tracks purchases and patterns Uses existing card readers Customizable purchase restrictions Blacks-out MCC codes Blacks out UPC codes Biometric ID (photo and fingerprint) Prevents Duplication For Government Use For Personal Use For Business Use Can set Spending Limits Cards Green Team

  29. Cost (Soft Customer) * http://www.processor.com/editorial/article.asp?article=articles/P2716/30p16.asp&guid= Green Team

  30. Cost (Hard Customer) * http://configure.us.dell.com/dellstore/config.aspx?c=us&cs=04&kc=6W300&l=en&oc=pe1950-max&s=bsd Green Team

  31. Pros • Smart Card Technology • Quick • Uses Biometrics • Safe and Secure • Customizable • Spending limits • Tracks Items Bought • Tracks Vendors Bought From • More Efficient • Saves Time Spent On Accounting • Saves money • Keeps better records • Automatic record of exact item bought and vendor shopped at • Better information for routine audits Green Team

  32. Cons • Uses fingerprints • People are afraid of giving up such information • Solved with encryption and marketing • Vendors need RFID readers • Requires New Technology • Many vendors are getting scanners • 7-11 is adding 5,600 RFID scanners this year* • Accidental blocking of necessary purchases • Solved with training and research • 24/7 Server/Website Maintenance * mastercard.com Green Team

  33. Risk Probability/Impact Matrix Green Team

  34. Risks Green Team

  35. Risks Green Team

  36. Return on Investment • Improves reputation of credit card company • Reduces loss of money due to unscrupulous purchases • Saves time used to perform manual audits • Reduces fraud • Reduces the number of investigations required Green Team

  37. Conclusion • Regulates how funds are spent • Uses biometrics • Prevents the use or selling of stolen cards • Vendors, credit customers, and card companies will benefit • Vendors will get higher quantity and more efficient business • Credit customers are protected and have less wait-time in line • Card companies get to sell cards and RFID sensors to vendors while increasing their number of users • C3P will revolutionize the credit system world wide Green Team

  38. Questions At this time, we welcome any questions you may have. Green Team

  39. References • DISD credit card oversight lax: • http://www.dallasnews.com • Picture 1: • www.co.kern.ca.us/dhs/images/0987.jpg • Picture 2: • www.katrinapictures.blogspot.com/ • Picture 3: • http://www.spasearch.org/admin/images/fld_main_photo/fld_main_photo_38.jpg • FEMA Fraud, http://www.msnbc.msn.com/id/11326973/ • IEEE Feasibility Study on biometric credit cards: http://www.ee.ucla.edu/faculty/papers/ingridv_TransCE_nov04.pdf#search=%2 2Portable%20Biometrics%22 • Smart Card technology with localized, portable biometrics: http://www.biometricassociates.com/smartcard.php • Open source smart card technology, both software and hardware: • http://www.smartcardalliance.org/industry_news/industry_news_item.cfm?ite mID=1596 Green Team

  40. References • Food stamp fraud: http://www.frac.org/html/federal_food_programs/programs/fsp_faq.html#4 • Food stamp info: http://www.fns.usda.gov/fsp/faqs.htm#9 • Data on food stamp fraud: • (http://www.eweek.com/article2/0,1895,1972079,00.asp) • (http://www.foodstampfraud.org/) • (http://www.cioinsight.com/article2/0,1540,1850300,00.asp) • FEMA Fraud data: • http://www.cnn.com/2006/US/09/13/katrina.fraud/index.html?section=cnn_topstories) • (http://www.msnbc.msn.com/id/11326973/) • Lockout codes • http://www.admin.mtu.edu/acct/dept/pur/purchcard/lockout.htm • Info on why this is a problem: • http://www.dallasnews.com/sharedcontent/dws/news/localnews/stories/070206dnmetpcards.192c71f.html • http://financialplan.about.com/od/studentsandmoney/a/TeenCreditCards.htm • Info on current program in place: • http://arc.publicdebt.treas.gov/DWP/fs/fscredcard.htm#1 • Data and why this is needed – EPA’s complaint paper on current system!!! • http://www.epa.gov/oig/reports/1995/bankrep.htm#CHAPTER%204 • How credit cards work: http://money.howstuffworks.com/credit-card2.htm Green Team

  41. Appendix A Expert Testimony from Admiral Julius Caesar from SAIC Green Team

  42. Expert Testimony – Current Problems • Navy sailors are given credit cards for travel because they do not have enough personal cash • Spending money in “Girly Bars” • Tabs in excess of $15,000 • Private Business • Employee used company credit card to put $14,000 down payment on a house • Employee bought several $1,500 airline tickets, and canceled the flight to collect the cash refund, which he used to finance his private company • Employee bought $1,500 in thongs at Victoria Secret Green Team

  43. Expert Testimony - Current Solutions • Only activating the credit card for the duration of the travel • Background credit checks on employees to be entrusted with company funds Green Team

  44. Expert Testimony – Loose ends left by current solution • Can’t regulate purchases • Company liable for purchases • Employees can’t pay the company back • Must be taken to court Green Team

  45. Expert testimony – Time and Money spent on problem • ~$25,000 per division per year • 20 Divisions • ~$250,000 per year for this company • Credit card companies dropped the Navy as a customer because of fraud problems Green Team

  46. Expert Testimony - Data • 2002: 1.4 million Government Travel Cards in use • $ 3.4 billion spent on purchases with these cards • One man made $262,800 in charges on 13 Government Credit Cards Green Team

  47. Expert Testimony – On C3P • Target “high risk” employees • In the 18-25 year-old bracket • Don’t know how to use credit • Employees with bad credit Green Team

  48. Authentication Green Team

  49. Fingerprints Advantages: • Relatively Mature Technology • Low Cost • Highly Portable Technology Green Team

  50. Finger Print Characteristics Genetic and environmental factors Never the same Biometric image cannot be reproduced Biometric Fingerprints • Finger Print Scanner • Capacitive Scanner • Electric Current Green Team

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