Mountain Home, Arkansas – February 1, 2007
It’s 4 AM and completely overcast with low gray clouds. There is five inches of fresh white snow on the ground. The small amount of light from neighboring houses reflects off the low clouds and onto the snow, making everything strangely bright and easy to see.
The pond is frozen over. I spent an hour yesterday, before it snowed, throwing big rocks up in the air to land on the ice. I love the sound the rocks make when they hit the ice. It’s a crisp, long Twangggg! that cuts the frozen air.
My friend here in Mountain Home is a national expert on credit and debit card transactions. He travels about the country keeping the heads of big banks and credit card companies abreast of new developments. We met in 1972 just after Vietnam, 35 years ago. I like to stop here, sample his homemade wine, and help him hang doors in the evening on the house in the woods he has been building, one piece at a time, for the last three years.
He tells me that the Republican controlled House and Senate passed a new law on credit cards last year. Now credit card companies can increase the rates they charge consumers if they are late on a single payment on any credit card or if the consumer’s credit rating drops slightly. Of course, he says, consumers in the US can no longer escape credit card debt though the bankruptcy process. The higher rates approach 40%, rather than the standard 20%.
Also interesting is the newfound ability of thieves to read the information on a debit card and calculate the card's PIN number. He tells me that a debit cards magnetic stripe contains an account number and a PIN number offset, which uses a 256 bit encryption algorithm, use to validate the PIN number. This information is read and stored each time the card is used at, say, Starbucks for coffee.
One US bank was hacked into and lost the information on 50 million accounts. The customers then began to find their accounts emptied though withdrawals at ATM in places like Latvia and Bulgaria. Paul believes that the PIN Number offset algorithm has been cracked, the only logical explanation for the Bank’s customer losses to date of $12 Billion dollars. Other banks and vendors have been hacked for account information.
The temperature is not projected to rise above zero degrees Centigrade for about ten days. We’d like to go to Florida and play tennis with friends camping in Sarasota, but driving out of here may be problematic.