1. E-Commerce and Micropayments-Identify and describe / explain 5 or
more
E-Commerce and MicropaymentsThis week your rotation assignment takes you to the Office
of the Chief Financial Officer (CFO).An external audit of the company’s financial operations
has just been completed. Last week, an “early look” copy of the audit was sent to the CFO
with a request for a formal written response for each of the findings. Some of the problem
areas were known to the CFO’s staff and they were already working on the required
responses. But, there is one set of findings that came as a complete surprise — Shadow IT
— the unauthorized / unapproved use of cashless payment technologies by certain
locations and offices within the company. These technologies included:1. Micro payments
using a payment card issued by guest services to hotel guests and via unattended vending
machines to visitors. These payment cards are loaded with a cash value deposited to the
card’s account via a credit card charge. Guest services also credits some of these payment
card accounts with “reward dollars” for guests who belong to the hotel’s affinity program.
The payment cards are used at service locations which do not have a cashier station. e.g.
game arcade, self-service laundry or sales kiosk, etc. The payments are processed by a third
party service provider which then uses an electronic funds transfer to pay the hotel its
share of the income.2. Mobile Payments for services booked through the concierge desk
with an authorized but independent provider (not a hotel employee). These services
include: private lessons with a tennis or golf pro, childcare, tours and tour guides,
interpreters, etc. These payments are made by cell phone either as a mobile payment using
a contactless payment system such as Apple Pay or by swiping a credit card through a
magnetic stripe reader connected to the provider’s cell phone. The payment accounts which
receive the guests’ payments are connected to the hotel’s merchant card accounts. The hotel
pays the providers monthly via electronic deposit and issues an IRS Form 1099 to record
the income.The CFO must make a presentation to the IT Governance board about these
payment systems as a first step towards either getting approval for continued use or issuing
a “cease and desist” directive to force the rogue offices and locations to stop using the
unapproved payment systems. The presentation must include information about known or
suspected compliance issues for PCI-DSS. The IT Governance board has previously asked
project sponsors for information about potential privacy and security issues.Due to the size
and complexity of the problem, the CFO has split the available staff into two teams. Team #1
will focus on the micro payment cards. Team #2 will focus on the mobile payment systems.
2. You have been asked to join one of these two teams and assist with their research. (Note:
you *must* pick one and only one of the two technologies to focus on for your discussion
paper this week.)Your team leader has asked you to read the provided background
information and then put together a 2 page summary of the important points from your
readings. You have also been asked to help identify and describe / explain 5 or more privacy
and security issues that could arise in conjunction with the use of the technology being
studied by your team. Remember to keep your focus on the financial aspects of the
technology implementation since you are contributing to the CFO’s effort. (Financial aspects
include how payments are made, what types of information are exchanged and with whom,
how that information is protected, etc.)Provide in-text citations and a reference list at the
end of your summary paper (APA format recommended).
