From: Alex 
Newsgroups: uk.finance
Subject: Re: Chip and Pin, from today's FT.
Date: Fri, 07 Jan 2005 23:17:31 +0000

Richard Buttrey wrote:
> On Thu, 23 Dec 2004 09:50:18 -0000, "Matti Lamprhey"
>  wrote:
> 
> 
>>"Tiddy Ogg"  wrote...
>>
>>>NATIONAL NEWS BUSINESS & ECONOMY:
>>>FT041223
>>>#153  Fraud liability threat over chip and pin RETAIL WARNING:
>>>
>>> By ISABEL BERWICK
>>>
>>>Retailers that have failed to put new chip and pin equipment into
>>>place could find themselves responsible for fraudulent
>>>transactions in their stores in the new year.
>>>
>>>On January 1 the liability for card fraud shifts from banks to
>>>retailers if they have failed to install chip and pin equipment
>>>on their premises.
>>>
>>>[...] it remains unclear who will take responsibility for
>>>frauds committed in shops that have installed the machines but
>>>whose customers insist on using the old signature-based
>>>technology.
>>
>>I've observed a spokesman from APACS being grilled on this recently.  If
>>a customer uses a signature-only card then the bank takes
>>responsibility.  If a customer uses a C&P card but is unwilling or
>>unable to enter the PIN, the retailer should contact the bank (it wasn't
>>clear whether this meant a phone call or use of an online terminal) and
>>the bank would then decide whether to accept responsibility or to leave
>>it with the retailer.  The APACS spokesman was repeatedly asked how the
>>bank made that decision, and merely hinted that an important factor
>>would be whether or not the card had been reported as stolen.
> 
> 
> 
> Seems something of a 'no-brainer' to me. If the card has been reported
> as stolen, why would the bank even be discussing accepting
> responsibility with the retailer? 
> 
> Surely the bank would mention this to the retailer, who would then
> abandon the transaction, and where practical attempt to detain the
> person presenting the card, and call the police.

I think what the APACS spokesman is talking about is not happening at 
the point that a credit/debit card is being used at point of sale, but 
once the fraud has been discovered, and liability has to be determined. 
  I'm pretty sure the system doesn't let you use a stolen credit card!