Research Group Picks Judge’s Overturning of Fed’s Durbin Rule as 2013’s Top Payments Event

We couldn’t recruit David Letterman to help us with this article, but what follows are the Top 10 U.S. payments events of 2013 as identified by the Retail Payments Risk Forum, a research and industry-dialogue unit at the Federal Reserve Bank of Atlanta.

10. The Consumer Financial Protection Bureau finalized money-transfer rules to implement Section 1073 of 2010’s Dodd-Frank Act.

9. Regulators increased their scrutiny of third-party processors and high-risk business customers.

8. Fraudsters launched major global ATM cash-out attacks that affected many U.S. ATMs and resulted in $45 million in losses.

7. The Federal Trade Commission proposed banning telemarketers from using remotely created checks and payment orders.

6. Debit networks sought a compromise on an EMV (Europay-MasterCard-Visa) chip card interface—while there was little movement on the issuance of EMV cards.

5. The U.S. Treasury Department released its newly designed $100 bill with additional security features.

4. Several major data breaches occurred (most recently at Target Corp.), and identity-theft occurrences skyrocketed.

3. Cyber Monday online sales jumped 17%, with mobile phones and tablets representing almost a third of the total.

2. Virtual currencies gained increased public, legislative, and regulatory awareness after the U.S. Department of Justice took action to close down virtual-currency operators Liberty Reserve and Silk Road.

1. U.S. District Court Judge Richard Leon threw out the Federal Reserve Board’s debit card interchange fees and routing rules implementing Dodd-Frank’s Durbin Amendment.

Forum members also identified some major payments issues they’ll be following in 2014:

• As regulators continue to monitor the virtual-currency market, will the usage of digital currency as a legitimate medium of exchange expand among merchants?

• Will 2014 finally be the “Year of the Mobile Payment?” What progress will be made in addressing the awareness, security, and education aspects of mobile payments?

• With online and mobile commerce showing no signs of slowing down, what authentication solutions will be widely adopted to prevent card-not-present fraud?

• How will merchants and card issuers implement EMV chip cards?

• What effects will the regulatory attention on third parties and high-risk businesses have on the due-diligence practices of financial institutions?

The full 2013 listing and issues for the upcoming year can be found on the Atlanta Fed’s Portals and Rails blog.