Hardened Commerce, introduced last month by ClearCommerce, offers a payment processing service certified by the major card associations' security initiative: MasterCard's Site Data Protection Program (SDP) and Visa's Cardholder Information Security Program (CISP, which includes the "Verified by Visa" program, or VbV).

That's important since the Visa and MasterCard programs can make merchants -- as the closest link to consumers in the credit card process -- responsible for bearing fraud liability unless they implement certified infrastructure. (Merchant processors and other players in the credit card process likewise have to implement certified infrastructure, as well, with liability risk falling to the lowest run in the ladder.)

"If a merchant fulfills a fraudulent order, it's the merchant's liability ... if the bank has offered them support for [Verified by Visa] and Secure Electronic Transaction technology, and they don't take advantage of it," said LaGarde's chief executive, Bob LaGarde.

ClearCommerce President and CEO Robert Lynch said in a statement, "The e-commerce pipeline is broken ... Although banks and gateways employ appropriate security measures, there are numerous security holes in the transaction chain, including shopping carts and integration processes that are not compliant with required standards."

In coming months, the credit card associations are expected to impose penalties on merchants (and others in the credit card process) for non-compliance with their security programs.

"Merchants this year, and their merchant account issuers, are going to start feeling the impact," LaGarde said. "We believe [card associations] will continue to ratchet up the cost of non-compliance to whoever in the chain has not stepped up to the plate."

"It's my perception that beginning very soon, merchants' ability to do transactions is going to become more and more dependent on the technology, and the cost of processing those transactions is going to become greater and greater if they are not up-to-speed on supporting the security technology," he added.

LaGarde is the first online storefront software vendor to partner with ClearCommerce, which means it can offer customers an infrastructure that complies with the card associations' anti-fraud initiatives -- and thus, protection from increased liabilities and penalties.

"We've tried to be on the leading edge, to step up to the plate and recognize appropriate methods for controlling fraud and helping protect merchants from fraudulent credit card activity, and to take the steps to implement the right technology that gives our merchants that kind of protection," LaGarde said. "ClearCommerce has taken a leading position in introducing a payment gateway product that has the VbV and secure code system built-in, and we've taken the lead as a shopping cart vendor to integrate that technology in our product and to offer it out to our merchants."

Christopher Saunders is managing editor of eCommerce-Guide.com.

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