Bloomington Rotary Club

ROTA-LETTER for Jan. 17, 2012
BLOOMINGTON ROTARY CLUB
Founded in 1918 • www.bloomingtonrotary.org
Rotary International 2011 Theme: Reach Within to Embrace Humanity

NEXT MEETING
Jan. 24: Randall Shepard, chief justice, Indiana Supreme Court, Frangipani Room, Indiana Memorial Union —
not the First Methodist Church, as previously announced.

President-elect Jim Bright conducted the meeting in the absence of President Jon Dilts.

GREETER:Scott Walters

PLEDGE AND REFLECTION: Sally Gaskill recognized our recent celebration of the birthday of Martin Luther King Jr. Sally reviewed an article appearing in New York Times Magazine discussing the results of a Legacy.com search that revealed more than 300 obituaries containing the words “the first black American.”
The names included ordinary people accomplishing what might be considered rather ordinary achievements were it not for the fact that black Americans had been denied the opportunity to accomplish even these modest achievements for hundreds of years.
The list of firsts included the first black milk delivery person, the first black meter reader, the first black registered nurse, the first black deputy sheriff and the first black firefighter.

INTRODUCTION OF GUESTS: Dawn Morley
Pryde Bayliss, a visiting Rotarian, Brown County
Annie Cornett and Fern Bonchek, guests of the club, representing People and Animal Learning Services
Jim Weikart, guest of Jon Dilts

BIRTHDAYS
John Bender, Bob Compton, Sally Gaskill and Linda Robbins

ANNOUNCEMENTS
Next week’s meeting will be at the Frangipani Room, rather than the previously announced First United Methodist Church.
Jean Emery reminded us of the upcoming Valentine’s Day rose sale. Funds will be processed through our own Bloomington Rotary Foundation so a portion of the purchase price will be tax deductible. The proceeds support scholarships for high school seniors. One hundred fifty dozen roses will be de-thorned and boxed by club volunteers so the assistance of club members is much needed.
Ron Jensen announced the club has received a District Simplified Grant for PALS. Coming from our club will be $500 of the $1,000 grant, and $500 will come from Rotary International Foundation. Fern Bonchek and Annie Cornett represented PALS, which provides therapy to special-needs children through the use of horses.
Bright expressed appreciation to —
Virginia Hall, for her work with those experiencing poverty and homelessness.
And all who have contributed to the eradication of polio. The result of those efforts is that polio now exists in only
Pakistan, Nigeria and Afghanistan.

PROGRAM
Randy Bridges introduced Fred Cate, director of IU’s Center for Applied Cybersecurity Research and the C. Ben Duton professor of law at IU’s Maurer School of Law.
Cate discussed the fraud scam that recently affected Nick’s English Hut, the historic Bloomington restaurant. This was a new type of scam that is relatively easy to do and difficult to defend, Cate said. It involved a rapid series of “charge-back” transactions —the transactions occur when merchandise purchased earlier is returned to a merchant. However, in this case there was no return of merchandise purchased earlier.
Those responsible for the fraud used a large number of transactions just under $1,000 to transfer money from Nick’s to accounts controlled by the criminal(s) in 33 different countries, with $1.2 million charged back in a few hours. The fraud was discovered before all the funds could be transferred to the accounts controlled by the criminals so the net amount actually lost was approximately $500,000.
Cate indicated we don't yet know with certainty who will bear the liability of the fraud. The fraud apparently occurred at the card processor's location, where someone was able to obtain Nick’s authorization number. The damage to Nick’s goes beyond the potential loss of these funds. Normal business operations were severely disrupted because the card processor “held” the cards preventing Nick's from using them to pay for merchandise they received on a cash-upon-receipt basis. Nick’s was also unable to accept credit card payments from customers for a period of time and will be responsible to pay the card processing fees based upon a percentage of the funds transferred illegally.
Cate recommends keeping a reasonable amount of cash in a secure location to be used in the event of a general breakdown in our ability to transmit data.
Referring to the recent hacking of Zappos, Amazon’s online shoe retailer, with 24 million customers, Cate indicated Zappos’ disclaimer of any credit card information being stolen provides little comfort since we are generally not liable for misuse of our credit card information by others. He indicated we should be very concerned about the other customer information that was stolen including names, addresses, phone numbers, email addresses and the last four digits of credit-card numbers. This type of information makes it possible for others to impersonate us and defraud us.
To protect ourselves, Cate recommended avoiding use the same password for a number of different sites. Be cautious when opening emails, and never click on embedded links in emails.
In closing, Cate reminded us we operate in a world in which data is very advantageous to us. We still don’t know how to secure the data adequately. The more we live in such a world, the more risk we incur. How we recover when losses occur is not well known.

UPCOMING MEETINGS
Jan. 24: Randall Shepard, chief justice, Indiana Supreme Court, Frangipani — not the United Methodist Church.
Jan. 31: Lenore Hatfield, founder, Camerata Orchestra, Frangipani.
Feb. 7: Charlotte Walker, development and communications director, Pets Alive, Frangipani Room.

Tim Thrasher, reporter