Payment instrument authorization technique

• US 6,931,382 B2
• Filed: 02/23/2001
• Issued: 08/16/2005
• Est. Priority Date: 01/24/2001
• Status: Expired due to Term

• Current Assignee: Dominique Laage, Kioba Processing, LLC (IP Investments Group LLC), Maria Theresa Evangelista
• Original Assignee: CDCK Corporation
• Inventors: Laage, Dominic P., Laage, Maria T.
• Primary Examiner(s): Trammell, James P.
• Assistant Examiner(s): Worjloh, Jalatee
• Application Number:
  US09/791,387
• Publication Number:
  US 20020138445A1
• Time in Patent Office: 1,635 Days
• Field of Search: 705 64- 80, 713/202
• US Class Current: 705/67
• CPC Class Codes: G06Q 20/02 involving a neutral party, e.g. certification authority, notary or trusted third party [TTP]
• CPC Class Codes: G06Q 20/04 Payment circuits
• CPC Class Codes: G06Q 20/085 involving remote charge determination or related payment systems
• CPC Class Codes: G06Q 20/0855 involving a third party
• CPC Class Codes: G06Q 20/12 specially adapted for electronic shopping systems
• CPC Class Codes: G06Q 20/3558 Preliminary personalisation for transfer to user
• CPC Class Codes: G06Q 20/367 involving electronic purses or money safes
• CPC Class Codes: G06Q 20/3672 initialising or reloading thereof
• CPC Class Codes: G06Q 20/3674 involving authentication
• CPC Class Codes: G06Q 20/382 insuring higher security of transaction
• CPC Class Codes: G06Q 20/385 using an alias or single-use codes
• CPC Class Codes: G06Q 20/4015 using location information
• CPC Class Codes: G07F 7/1008 Active credit-cards provided with means to personalise their use, e.g. with PIN-introduction/comparison system

Abstract

A method is provided for protecting a payment instrument in non-face-to-face transactions. The payment instrument is issued by an issuing entity and associated with an authorized instrument holder. The authorized instrument holder is subject to authentication by a trusted third party with whom the payment instrument holder has previously registered. The method includes: the authorized instrument holder communicating with the issuing entity to block, on a default basis, authorization of the payment instrument for non-face-to-face transactions unless authorized to unblock the payment instrument by the trusted third party; prior to a non-face-to-face transaction, the authorized instrument holder communicating with the trusted third party to subject him or herself to authentication and to request that the payment instrument be unblocked; and the trusted third party authenticating the authorized instrument holder, and if the authentication result is positive, communicating with the issuing entity to request unblocking of the payment instrument.

Claims

1. A method of protecting a payment instrument in non-face-to-face transactions, the payment instrument being issued by an issuing entity and associated with an authorized instrument holder, the authorized instrument holder being subject to authentication by a trusted third party with whom the payment instrument holder has previously registered, the method comprising:

the authorized instrument holder communicating with the issuing entity to block, on a default basis, authorization of the payment instrument for non-face-to-face transactions;

prior to a non-face-to-face transaction, the authorized instrument holder communicating with the trusted third party to subject him or herself to authentication and to request that the payment instrument be unblocked for non-face-to-face transactions; and

the trusted third party authenticating the authorized instrument holder, and if the authentication result is positive, communicating with the issuing entity to store the request to unblock the payment instrument for non-face-to-face transactions.

2. A method according to claim 1, wherein, the issuing entity retrieves and enforces the unblocking request from the trusted third party, and the non-face-to-face transaction is a transaction with a merchant and further comprising the step of the issuing entity forwarding a payment authorization response to the merchant in response to receipt of a request for authorization from the merchant.

3. A method according to claim 1, wherein the customer has previously blocked use of the payment instrument for non-face-to-face transactions on a default basis and the trusted third party is further adapted to receive a request from the customer to unblock use of the payment instrument for non-face-to-face transactions, the method further comprising the steps of:

using a satellite computer system, associated with the trusted third party and located in proximity to an issuing entity of the payment instrument, the satellite computer system being adapted to communicate with the issuing entity to store the unblock request for the payment instrument account for non-face-to-face transactions in response to a request from the trusted third party computer system to unblock the payment instrument for non-face-to-face transactions, the request being made by the trusted third party computer system upon successful authentication by the trusted third party computer system of the identity of the customer as an authorized user of the payment instrument.

4. A method according to claim 3, wherein the customer has previously blocked use of the payment instrument only in non-face-to-face transactions.

5. A method of protecting a payment instrument in non-face-to-face transactions, the payment instrument being issued by an issuing entity and associated with an authorized instrument holder, the authorized instrument holder being subject to authentication by an authentication function, the method comprising:

the authorized instrument holder communicating with the issuing entity to block, on a default basis, authorization of the payment instrument for non-face-to-face transactions;

prior to a non-face-to-face transaction, the authorized instrument holder communicating with an authentication function to subject him or herself to authentication and to request that the payment instrument be unblocked for non-face-to-face transactions; and

the authentication function authenticating the authorized instrument holder, and if the authentication result is positive, causing the issuing entity to store the request to unblock the payment instrument for non-face-to-face transactions.

6. A method of protecting a payment instrument used in transactions, the payment instrument being issued by an issuing entity and associated with an authorized instrument holder, the authorized instrument holder being subject to authentication by an authentication function, the method comprising:

blocking the authorization for a payment instrument, on a default basis, by the issuing entity;

communicating by the authorized instrument holder, prior to a transaction or multiple transactions, with an authentication function to subject the authorized instrument holder to authentication and to request that the payment instrument be unblocked for future payment authorizations; and

authenticating the authorized instrument holder, and if the authentication result is positive, causing the issuing entity to store the request to unblock the payment instrument for the authorization of payments for the transaction or transactions.

7. A method of claim 6 further comprising a set of conditions set by the instrument holder after successful authentication which must be met before the issuer authorizes the payment instrument for a particular transaction or series of transactions, the conditions being one or more of the following:

the transactions are equal to or less than a certain amount total, either individually or collectively;

the transaction(s) are in a geographic location or locations where the transaction(s) may take place;

the transaction(s) take place on a date that is after a set start date and before a set end date;

the transaction(s) are such that the card must be present;

the transaction(s) are such that the card is not present.

8. A method of claim 6 further comprising the authorized instrument holder communicating with the authentication function through one of the following methods:

by using an application program running locally on the authorized instrument holder'"'"'s computer or portable computing device which communicates with the authentication function over a network or dial-up connection;

by using an application program accessible through the web;

by using an application program in conjunction with a storage medium in the possession of the authorized instrument holder, the storage medium storing encrypted personal information;

by using the telephone to dial into an automated response system;

by contacting a call center or customer service center.

9. A method of claim 6 further comprising notification to the authorized instrument holder of the current status of the payment instrument using one or more of the following means:

email;

voice notification through a telephone line;

a short message signal sent to a pager or mobile phone;

through an application program running locally on the authorized instrument holder'"'"'s computer or portable computing device;

through an application program accessible through the web;

by contact with a call center or customer service center.

10. A method of claim 6 further comprising a means for the payment instrument holder or a merchant involved in a transaction to view the transaction details including the authorization status of the payment instrument at the time of the transaction.