In late March Thales released an interesting report on the state of PCI – “PCI DSS Trends 2010: QSA Insights Report.”  The report was written by the Ponemon Institute and it highlights the difficulty of taking into account risk, security and subjectivity within the PCI DSS compliance standard. If you haven’t read it, here’s a link: First, the insight that only 2% of organizations fail their PCI audits should raise some eyebrows. Taking it at face value (and there’s certainly room for discussion about that) it indicates that, in general, retailers and payment processing related organizations are taking PCI compliance seriously. However, when combined with another observation in the report, that about 40% of organizations are relying on compensating controls, it illustrates the subjectivity of the standard and of the “auditing” process.  There are a number of other conclusions that can be drawn from this high pass rate, and hopefully, the Council will look into them. Second, the report says that over 50% of the QSAs surveyed observe that information security is still not being taken seriously by the organizations they are auditing.  Even though almost all of the organizations covered in the review are addressing PCI, most are not truly addressing security and, by extension, risk – which is a level of maturity that usually requires enlightened management or a breach.  This finding further highlights how important it is for audits to be done by competent and honest auditors.  Like the point above, this gets at the core of PCI – the standard and the associated subjectivity should evolve to ensure that security and risk be addressed, not just compliance. Finally, the report states that QSAs feel that firewalls and encryption are the most effective technologies used to protect cardholder data. The number of organizations that think they are doing one thing (with technology) and are actually doing another is amazing. ASV scanning is a very important component of verifying technical compliance, but with self-attestation for many internal components it doesn’t cover nearly enough. With this in mind, the PCI Council should implement further verification to ensure that technology and controls are implemented properly. This would continue to drive the convergence of compliance and security. More reviews – especially third-party – would also help organizations better understand risk and develop mechanisms to mitigate it programmatically. Overall, the report says as much about the state of the PCI standard as it does about the organizations it covers. Some of the more interesting insights are the implications surrounding PCI’s subjectivity and maturity.  The positive take away from the report is that it appears organizations affected by the initial PCI focus (retailers and payment processing-related firms) are taking PCI compliance seriously. To achieve the common goal of reducing IT risk related to PCI data, hopefully the Council will be able use this report  (and other similar reports) to enhance the standard to cover more security and risk.