Green Team
November 15, 2006
Product: Customizable Credit
Card Protection (C3P)
Organization Chart
11/15/2006
Green Team
2
Presentation Outline
•
•
•
•
•
•
•
•
Problem/Solution Introduction
Process Description
Solution Characteristics
Market Analysis
Milestones, Deliverables, Budgets
Risk Assessment
Return On Investment
Conclusion
11/15/2006
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3
Inspiration - Scenario
• You own a business, for
example, a construction
business
– Large employee base
– Employees need to make
purchases
• Company credit account
• Manual receipt tracking to
validate purchases
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4
Problem Statement
Organizations and private businesses have
inadequate protection and controls over
unauthorized use by authorized
cardholders, which results in a loss of
funds.
Current methods of addressing
unauthorized use are expensive and
subjective.
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5
Inspiration – Limiting by
Vendor
• Since your employees
should only need to
shop for building
supplies and maybe
other general supplies
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6
Inspiration – Limiting by
Vendor
• They should not be using
this card in stores other
than those that sell these
types of merchandise
11/15/2006
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7
Inspiration – Limiting by
Vendor
• By differentiating the types
of stores the card is used
in we can limit card
purchases to only certain
vendors
11/15/2006
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8
Inspiration – Limiting by
Product
• Hardware stores
and construction
supply stores have
a wide selection of
products for sale
11/15/2006
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Inspiration – Limiting by
Product
• Some of these
items you do not
want your
employees to
purchase on the
company credit card
11/15/2006
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10
Inspiration – Limiting by
Product
• To guard against
these unauthorized
purchases, our
solution will allow
business leaders to
customize specific
items that each
employee is allowed
to buy from certain
stores
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Inspiration – Setting
spending limits
• Your company’s
budget is limited
and fraudulent
purchases can
prohibit you from
making necessary
purchases
news.bbc.co.uk/1/hi/uk/3476815.htm
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Inspiration – Setting
spending limits
• Per diem spending
limits prohibits
overspending with
the company credit
card by entrusted
employees
news.bbc.co.uk/1/hi/uk/3476815.htm
11/15/2006
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Inspiration – Data Mining
news.bbc.co.uk/1/hi/uk/3476815.htm
11/15/2006
• A building site
may need a
certain amount of
wood on a daily
basis and many
purchases are
spur of the
moment or
outside of the
original plan
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Inspiration – Data Mining
• The receipt tracking
system is subjective
and receipts can be
misplaced
news.bbc.co.uk/1/hi/uk/3476815.htm
11/15/2006
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Inspiration – Data Mining
• Online data mining
makes tracking
employee spending
habits easier
news.bbc.co.uk/1/hi/uk/3476815.htm
11/15/2006
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Inspiration - Web Interface
• And all of these
settings are easily
customizable through
a web interface on
our webpage.
news.bbc.co.uk/1/hi/uk/3476815.htm
11/15/2006
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Solution - C3 Protection Card
•So what is C3P? – Customizable Credit Card Protection
11/15/2006
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Credit Card Misuse
• Visa Business Card Spending
– $190 Billion in 2006 *
• EPA research
– Government Credit Card Holders
• 11% cannot produce receipts of purchases *
• 9% of those that could be produced purchased
prohibited items *
* http://www.epa.gov/oig/reports/1995/bankrep.htm#CHAPTER%204
Green Team
11/15/2006
19
Examples of Credit Card
Misuse
• 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/
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Examples of Misuse
• Surveyed Company
– Misuse Prevention
• $250,000 spent per year
• $100 per employee
• Corporate credit cards
– Responsibility of corporation
• Not card holder
– Company loses money on misuse
* Admiral Julius Caesar
** James Brunelle
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Problem Characteristics
•Tracking physical receipts
–Labor Intensive
–Inaccurate
–Difficult to identify and filter misuse
–Unreliable
–Easy to lose
•Employees produced 20% of all transaction
receipts*
•Organization loses money
–Companies are reimbursing employees for
unauthorized and personal purchases
* http://www.dallasnews.com
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Solution Concepts
• Regulate Types of Purchases
– Reduce Receipt checking
– Improve Accuracy
• Automatic prevention of prohibited purchases
– Improve reliability
• Organization saves money
– Keeps control of money in hands of employer
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Solution Characteristics
• Customizable database
– Restrict Purchases by
• Universal Product Code (UPC)
– Only at participating locations in USA
• Merchant Commercial Code (MCC)
– Everywhere, including overseas
• Use Contact RFID Smart Cards
– Fast & Secure
– Programmable for transaction routing
• Modifiable sending of UPCs and MCCs
• Software
– Web-based GUI
• User access for modification of card holder account
• Reporting and Analysis tools
• Drives Database
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Software - Features
• Package includes
– GUI
– Database
– Checking software
• Customizable database to hold approved
purchases
• 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
11/15/2006
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Software - Reporting and
Analysis
• Employee purchases
– Tracked and listed by employee
• Online Receipt Tracking
– List accepted and rejected purchases
– Grouped by purchaser, date, and MCC
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Major Functional Component
Diagram
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Getting C3P Cards
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Modification of Database
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Old Process of Making a
Purchase
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New Process of Making a
Purchase
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Purchase Verification
11/15/2006
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Vendor – C3P Communication
11/15/2006
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Graphical User Interface MCC
11/15/2006
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Graphical User Interface UPC
11/15/2006
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Return on Investment
• Reduces fraud
• Corporate money is spent according to
company policy
– Reduces loss of money due to unscrupulous
purchases
• Saves time that would otherwise be used to
perform manual audits
• Reduces the number of investigations required
and their corresponding court costs
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Management Plan
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Management Plan Communications
• Group Meetings
– Sun. 8:00 PM, Wed. 8:00 AM, Fri. 9:00 AM
– Minutes & Assignments sent via e-mail
• Team web page
– Discussion
– Minutes
– Research
• Frequent Communications
– E-mail
– Phone
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Management Plan - Tools
• Old Dominion
University
– Labs
– Meeting Rooms
• Microsoft Project
2003
– Used to manage
project
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Development Plan Software Solution
An approximately 4,450 LOC solution
including:
– Networking package
• Accepts incoming connections
• Sends out data
– Database code
• Data lookup
– Web interface
• Users and administrators to view and edit
information
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Networking Package
• Networking program suite
– Uses an established networking library
• Allow incoming data from the modem
• Queuing logic & mutual exclusivity
– Ensure no data loss or corruption
• Credit Card Data
– Format credit card data
– Forward it to the credit card company
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Database Package
• Convert incoming transaction data
–
–
–
–
MCC
Place of purchase
Purchase amount
UPC
• Analysis engine
– Compare the pieces of incoming data with the allowed
settings that are stored on the C3P MySQL server
• Database engine
– Stored and arrange data for formatting in reports
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Database Fields
• Shall include the following:
– Card ID number
– Card user name
– Company name of card user
– Approved list of MCCs
– Approved list of UPCs
– Company credit card number
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Web Interface
• Written in PHP
• Easy-to-use interface
– Customers and administrators
• Update user information and products
• Provide access to spending reports
– Individuals & groups
– Reports of misuse
11/15/2006
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Credit Card Data
Security Standard
•
•
•
•
Build and maintain a secure network
Protect cardholder data
Maintain a vulnerability management plan
Implement strong access control
measures
• Regularly monitor and test networks
• Maintain an information security policy
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Evaluation Plan
•
•
•
•
•
•
Financial
Technical
Schedule
Personnel
Weekly Progress Reports
Unit and Acceptance Test
– Required to complete milestones
• Risks directly related to factors focused on
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Marketing Plan
• Primary target market: Businesses
• Advanced target market: Concerned
parents
• Corporate buy-in
• Benefits to the customer
• Initial businesses for beta testing
• Advertising & Marketing strategy
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Primary Target Market
• Users of Credit Cards
– Businesses
– Corporations
– Concerned Parents
• Initial phase: Businesses
– Small businesses report billions of dollars in
losses through embezzlement each year*
* http://www.fbi.gov/publications/financial/fcs_report052005/fcs_report052005.htm
11/15/2006
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Primary Target Market
• Advanced Phases: Concerned Parents
• Parents are concerned with giving children control
of a credit card yet are even more concerned
about giving a child real cash*
• Minors are Credit Card Company’s new target
consumer**
•http://www.bankrate.com/fox/news/cc/20000508.asp
•** http://www.bankrate.com/fox/news/cc/20000508.asp
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Benefits to the customer
• Secure and efficient control of company
funds
• Reduced costs to prevent and lessen the
effects of fraud
• Parental control of children's spending
11/15/2006
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Corporate buy-in
• Benefits to the corporation
– Targeted stores receive
business from C3P
cardholders
– Advanced Phase: Can request precedence in
the GUI lookup
11/15/2006
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Initial businesses for beta test
• Initiate beta testing on local business
• E.D.O. & S.A.I.C.
– Expressed interest and acknowledged
innovativeness
– These companies alone reflect a loss due to
credit card misuse
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Overall Marketing Strategy
•
•
•
•
•
Travel to the individual businesses
Prove successful with single beta project
Pursue a greater region of businesses
Begin advertising campaign
Receive corporate buy-in
- Companies such as Target, Wal-Mart, Home
Depot, etc.
• Take on full scale nationwide implementation
• Hit advertising mediums
11/15/2006
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Advertising Strategy
• Distribution
– Initial Roll-Out: Get one credit company on
board
• Advertising Mediums (Once onboard)
– National Newspapers
• Technology and business sections
– MarketPro Technology Shows
– TV/Internet
11/15/2006
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Ways to Use C3P
• Leasing
–
–
–
–
Rent Server and Database
Buy Software Package
C3P Controlled and Maintained
No initial costs
• Only service fee and leasing fee
• Buying
–
–
–
–
Buy Server and Database
Buy Software Package
Controlled within corporation
Initial fee
• Maintainence fee
– Eliminates Privacy concerns if sensitive data is stored in
Database
11/15/2006
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55
Competition Matrix
Cards
MTU puchasing
X
Government Credit
X
Food Stamps
X
Worldwide Purchasing
X
Lecarte Purchase
X
NASA SmartPay
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
PayPal
X
X
Mastercard
X
X
X
X
X
C3P
X
X
X
X
X
11/15/2006
X
X
X
X
Green Team
X
X
X
X
X
X
56
Milestones and Deliverables
Phase 0 (CS410)
Phase 1 (CS411)
Feasibility Presentation
Team website
Presentation
Software
Requirements Document
Design Document
Application Code
Data Mining Code
Formatting Code
Milestone Presentation
Presentation
Demonstration Prototype
Completed Prototype
Final Presentation
Product Website
Presentation
Testing
Test Plan Document
SBIR document
NSF SBIR Proposal Phase 2
SBIR document
NSF SBIR Proposal Phase 1
11/15/2006
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Milestones and Deliverables
Phase 2: Critical Design
Phase 3: Production Out
Years
Hardware
Hardware Requirements Document
Database Setup
Production
Card Company Contract
Vendor Contract
Software
Requirements Document
Design Document
Database Application Code
POS Application Code
Data Mining Code
Test Plan
Financing
Venture Capital/Investment
11/15/2006
Distribution
Distribution Contract
Marketing
Advertising Campaign Launch
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58
Schedule Overview
• Phase 0
– 4 months
– September 2006 to December 2006
• Phase 1
– 4 months
– January 2007 to May 2007
11/15/2006
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Schedule Overview
• Phase 2
– 17 months
– June 2007 to November 2008
• Phase 3 (Production & Out Years)
– December 2008 and Beyond
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Project Flow - Outline
ID
Phase
Start
Finish
Length
1
2
3
4
Phase 0
8-30-06
12-18-06
109 days
Phase 1
12-19-06
4-17-07
120 days
Phase 2
4-17-07
4-27-08
375 days
Phase 3
4-27-08
8-1-08
70 days
11/15/2006
2006
Green Team
2007
2008
61
Phase 0: Organization Chart
11/15/2006
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Project Flow – Phase 0
Finish
Length
Conception 8-30-06
9-19-06
20 days
Planning
9-18-06
10-3-06
15 days
Initial
Research
9-20-06
10-6-06
13 days
Feasibility
Presentation
10-9-06
10-18-06
8 days
Milestone
Presentation
11-3-06
11-15-06
9 days
Approval
Presentation
11-16-06
12-18-06
23 days
SBIR
Creation
10-31-06 12-13-06
44 days
Website
Creation
9-18-06
74 days
Phase
Postmortem
11/15/2006
Start
12-1-06
12-14-06 12-18-06
9/06
4 days
Green Team
10/06
11/06
12/06
63
Phase 1: Organization Chart
11/15/2006
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64
Project Flow – Phase 1
Phase
Start
Finish
Length
Prototype
Planning
12-19-06
1-1-07
13 days
Research
Tech.
1-2-07
1-7-07
5 days
Setup
1-8-07
1-19-07
11 days
Design
1-19-07
2-20-07
32 days
Development
2-20-07
3-10-07
18 days
Testing
3-10-07
4-1-07
21 days
Implement
4-1-07
4-5-07
5 days
3-13-07
4-17-07
34 days
SBIR
Phase 2
11/15/2006
12/06
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1/07
2/07
3/07
4/07
65
Phase 2: Organization Chart
11/15/2006
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66
Project Flow – Phase 2
Phase
Start
Finish
Length
Develop
Team
4-17-07
5-30-07
43 days
Planning
5-30-07
7-22-07
52 days
Requirements
7-22-07
8-27-07
36 days
Setup
8-27-07
10-3-07
36 days
Design
10-3-07
11-26-07
54 days
Development
11-26-07
1-18-08
52 days
Testing
1-18-08
4-10-08
82 days
Documen
-tation
3-10-08
4-27-08
48 days
11/15/2006
Spring
07
Green Team
Summer
07
Fall
07
Winter
07/08
Spring
08
67
Phase 3: Organization Chart
11/15/2006
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68
Project Flow – Phase 3
Phase
Start
Finish
Length
Develop
Team
4-28-08
5-20-08
22 days
Hire
Personnel
4-28-08
5-2-08
5 days
Office
Setup
4-27-08
4-30-08
3 days
Obtain
Loan
4-28-08
5-9-08
11 days
Initial
Rollout
4-28-08
7-21-08
82 days
Nationwide
Rollout
7-21-08
8-1-08
10 days
11/15/2006
4/08
Green Team
5/08
6/08
7/08
8/08
69
Funding By Phase
Funding By Phase
Funding By Phase
11/15/2006
$450,000
$0
$120,314
$120,314
$65,697
$409,112
$474,809
$400,000
$350,000
Budget Cost
Phase 1
Hard Resources
Personnel Resources
Total
Phase 2
Hard Resources
Personnel Resources
Total
Phase 3
Hard Resources
Personnel Resources
Total
TOTAL Funding
$300,000
$250,000
Hard Resources
$200,000
Personnel Resources
$150,000
$100,000
$15
$51,351
$51,366
$646,489
$50,000
$0
Phase 1 Phase 2 Phase 3
Phase
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70
Phase 1 Budget
Hard Resources
Product
TOTAL
Personnel Resources
Resource
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Development Team
Web Developer
GUI Programmer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
TOTAL
# Units Cost/Unit
Total
$0
#
1
Salary*
Overhead Hourly Hours Total
$75,616
$105,862
$55
562
$30,987
2
1
$73,252
$56,926
$102,553
$79,696
$53
$42
579
10390
$61,799
$431,274
2
$57,397
$80,356
$42
0
$0
2
1
3
1
1
1
$52,920
$46,282
$45,368
$68,141
$35,751
$108,901
$74,088
$64,795
$63,515
$95,397
$50,051
$152,461
$39
$34
$33
$50
$26
$79
108
944
0
0
696
0
$8,335
$31,857
$0
$0
$18,144
$0
$582,395
TOTAL Resources
*Salary.com
11/15/2006
$582,395
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71
Phase 2 Budget
Hard Resources
Product
DELL PowerEdge 6800 Advanced
Windows Server 2003, Enterprise Ed.
Microsoft Project Server
RFID Cards
Card Programmer
Card Printer
Domain Name Registrations
TOTAL
Personnel Resources
Resource
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Maintenance & Installation Team
Web Developer
GUI Programmer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
TOTAL
# Units
3
3
3
500
1
1
1
#
1
Cost/Unit
Total
$17,605
$52,815
$3,295
$9,885
$999
$2,997
$0.16
$80
$90
$90
$3,000
$3,000
$15
$15
$65,697
Dell.com
InternetSolutions.com
Salary*
Overhead
Hourly
Hours Total
75,616
105,862
55 1,008
55,578
3
1
$73,252
$56,926
$102,553
$79,696
$53
$42
0
4288
$0
$177,989
3
$57,397
$80,356
$42
77
$9,710
3
2
7
1
1
1
$52,920
$46,282
$45,368
$68,141
$35,751
$108,901
$74,088
$64,795
$63,515
$95,397
$50,051
$152,461
$39
$34
$33
$50
$26
$79
713
921
266
0
391
0
$82,500
$62,163
$61,663
$0
$10,193
$0
$459,794
TOTAL Resources
$525,491
*Salary.com
11/15/2006
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72
Phase 3 Budget
Hard Resources
Product
Domain Name Registrations
TOTAL
Personnel Resources
Personnel Resources
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Maintenance & Installation
Team
Web Developer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
Marketing Director
Bookkeeper
C3P Rep (Vendors)
C3P Rep (Businesses)
Customer Support Team
Web Customer Support Specialist
Attorney II
TOTAL
# Units Cost/Unit Total
1
$15
#
1
$15
$15
Salary*
Overhead Hourly Hours Total
$75,616 $105,862
$55 1139
$62,645
3
1
$73,252
$56,926
$102,553
$79,696
$53
$41
0
10
$0
$820
2
$57,397
$80,356
$41
705
$57,810
1
2
1
1
1
1
1
1
1
$52,920
$45,368
$68,141
$35,751
$108,901
$95,703
$36,325
$25,944
$25,944
$74,088
$63,515
$95,397
$50,051
$152,461
$133,984
$50,855
$36,322
$36,322
$38
$33
$49
$26
$79
$69
$26
$18
$18
0
1147
0
0
80
280
0
280
280
$0
$75,669
$0
$0
$6,320
$19,320
$0
$5,040
$5,040
3
1
$41,014
$76,844
$57,420
$107,582
$29
$56
0
158
$0
$8,848
$241,512
TOTAL Resources
*Salary.com
11/15/2006
$241,527
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73
Cost Per Customer
• Phase 3 Total Budget: $
– Charge each business this amount
– Make a profit
• Total Cost (Licensing per Year): $
– Authentication code
– User manual
– Access to customizable database
– Programmed RFID cards
– POS Terminal Software for Vendors
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74
Funding Plan
• National Science Foundation (NSF)
– Phase 1: Funding award up to $100k
• Proposal Deadline: December 4, 2006
• Topic: Information Technology
• Phase 1 Total Budget: $
– Phase 2: Funding award up to $750k or two years
(whichever is reached first)
• Phase 2 Total Budget: $
• CIT Commercial Giving Program Commercial
Finance Group
– Additional funds needed above the $100k and $750k
• No deadline
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75
Funding Plan
• Phase 3 funding obtained through venture
capital from outside investors
– Phase 3 Total Budget: $
• Total Budget (All phases): $
11/15/2006
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76
Risk Management Plan
• Identify Risk
• Categorize risk based on severity and
probability
• Reduce risks
• Evaluate risk level
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77
Risk Reduction Methods
•
•
•
•
Avoidance
Acceptance
Transference
Mitigation
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78
Risk Probability/Impact Matrix
P
r
o
b
a
b
i
l
i
t
y
1 No corporate buy-in
81-100%
Access to credit card
2
info
61 - 80%
Hardware
3
malfunction
41 - 60%
1
4 Software malfunction
2, 3
Retailers won’t
provide database
5
or update POSTs
5
21-40%
4
1-20%
Insulting to
6
employee
6
1
2
3
4
5
Impact: 1(Low) - 5(high)
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79
Risks
Risk#
Risk Description
Mitigation Actions
1
No corporate buy-in
Marketing plan and innovativeness
of product
2
Access to Personal Info from Credit
Card Companies
Encryption, policy of not reading
the information
3
Hardware Malfunction or Viruses
Use proven hardware
4
Software Malfunction
Thorough testing and 24/7 support
5
Retailers won’t give up UPC
database or update POS terminals
Create an independent UPC
database
6
Insults Employee (can not be
trusted)
Marketing plan and training to avoid
insulting employees
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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
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Pros
• Saves money
• Customizable
– Spending limits
– Tracks Items Bought
– Tracks Vendors Bought From
• More Efficient
– Saves Time Spent On Accounting
• Keeps better records
– Automatic record of exact item bought and vendor shopped at
– Better information for routine audits
• Smart Card Technology
– Quick
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Cons
• 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
• POS Terminals need updates
* mastercard.com
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Conclusion
• Regulates how funds are spent
–Saves money and time
• Vendors and credit customers will benefit
–Vendors will get higher quantity and more efficient business
–Credit customers are protected and have less wait-time in line
–Vendors will gain revenue from businesses that use UPC
blocking
• C3P will revolutionize the credit system world wide
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Questions
At this time, we welcome any questions you
may have.
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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
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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/070206dnmetp
cards.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
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Appendix A
Expert Testimony from Admiral Julius
Caesar from SAIC
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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
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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
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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
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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
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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
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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
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Appendix B
Merchant Commercial Code (MCC) – A specialized
code that categorizes a store based on what it sells
(e.g. Target and Wal-Mart have the same MCC) –
example MCC: 5598 – Snowmobile Dealership
Universal Product Code (UPC) – A code that
designates a specific product, different for every
brand and variation of a product (Lay’s and
Pringle’s potato chips still have different UPCs) –
Sample UPC: 02248604 Orbit Gum
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Security - RFID
• 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
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