U.S. patent application number 12/467181 was filed with the patent office on 2009-09-10 for tokenless biometric electronic financial transactions via a third party identicator.
This patent application is currently assigned to YT ACQUISITION CORPORATION. Invention is credited to Ned Hoffman, Philip D. Lapsley, Jonathan Alexander Lee, David Ferrin Pare, JR..
Application Number | 20090228362 12/467181 |
Document ID | / |
Family ID | 34427117 |
Filed Date | 2009-09-10 |
United States Patent
Application |
20090228362 |
Kind Code |
A1 |
Lapsley; Philip D. ; et
al. |
September 10, 2009 |
TOKENLESS BIOMETRIC ELECTRONIC FINANCIAL TRANSACTIONS VIA A THIRD
PARTY IDENTICATOR
Abstract
A method and device enables tokenless authorization of an
electronic payment between a payor and a payee using an electronic
identicator and a payor bid biometric sample. The payor registers
with a registration biometric sample, and a payor financial account
identifier. The payee registers a payee identification data with
the electronic identicator. A payee bid identification data and a
payor bid biometric sample are electronically forwarded to the
identicator. The bid biometric sample is compared with registered
biometric samples and the payee's bid identification data is
compared with a payee's registered identification data for a
successful or failed identifications of the payor and payee. If
successful, an electronic financial transaction is then formed
comprising a transaction amount and a payor financial account
identifier. Loyalty or reward information stored in the database at
the DPC is automatically transmitted back to the PIA along with any
financial account information.
Inventors: |
Lapsley; Philip D.;
(Oakland, CA) ; Lee; Jonathan Alexander; (Oakland,
CA) ; Pare, JR.; David Ferrin; (Berkeley, CA)
; Hoffman; Ned; (Sebastopol, CA) |
Correspondence
Address: |
MARGER JOHNSON & MCCOLLOM, P.C. - You Technologies
210 SW MORRISON STREET, SUITE 400
PORTLAND
OR
97204
US
|
Assignee: |
YT ACQUISITION CORPORATION
Delray Beach
FL
|
Family ID: |
34427117 |
Appl. No.: |
12/467181 |
Filed: |
May 15, 2009 |
Related U.S. Patent Documents
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Application
Number |
Filing Date |
Patent Number |
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11109096 |
Apr 18, 2005 |
7536352 |
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12467181 |
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09731536 |
Dec 6, 2000 |
6950810 |
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11109096 |
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09239570 |
Jan 29, 1999 |
6269348 |
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09731536 |
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08705399 |
Aug 29, 1996 |
5870723 |
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09239570 |
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08442895 |
May 17, 1995 |
5613012 |
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08705399 |
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08345523 |
Nov 28, 1994 |
5615277 |
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08442895 |
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Current U.S.
Class: |
705/44 ;
705/78 |
Current CPC
Class: |
G06F 2211/008 20130101;
H04L 63/04 20130101; H04L 63/0861 20130101; G06Q 20/02 20130101;
G07F 7/1008 20130101; G06Q 20/0855 20130101; G06K 9/00087 20130101;
G06Q 20/367 20130101; H04L 63/0428 20130101; G06Q 20/10 20130101;
G07F 19/201 20130101; G06F 21/554 20130101; G06F 21/32 20130101;
G06Q 20/40145 20130101; G06Q 20/102 20130101; G06Q 20/4014
20130101; G06Q 20/4097 20130101; G07F 19/207 20130101; G06Q 20/382
20130101; G07C 9/32 20200101; G06F 21/86 20130101; G07F 9/002
20200501; G06Q 40/00 20130101; H04L 63/083 20130101; G06Q 20/04
20130101; G01F 19/005 20130101; G06Q 20/18 20130101; H04L 2463/102
20130101; G06Q 20/3674 20130101; G06Q 20/341 20130101; G06F 21/83
20130101; G06K 9/6255 20130101; G06Q 30/02 20130101; H04L 63/0442
20130101; H04L 63/123 20130101; G06Q 20/12 20130101; G06Q 20/00
20130101; G06Q 20/40 20130101; G07C 9/37 20200101; G06F 2221/2117
20130101 |
Class at
Publication: |
705/14 |
International
Class: |
G06Q 20/00 20060101
G06Q020/00; G06Q 30/00 20060101 G06Q030/00 |
Claims
1. A method for tokenless authorization of a loyalty or reward
transaction, the method comprising: gathering via a party
identification apparatus a biometric sample from a payor;
transmitting the gathered payor biometric sample via a
communication line to a data processing center; identifying the
payor via the data processing center, wherein the identifying
comprises the data processing center comparing the gathered
biometric sample with a registered biometric sample for producing
either a successful or failed identification of the payor; and
wherein upon successful identification of the payor; forwarding
from the data processing center to the party identification
apparatus one or more of payor loyalty information and payor reward
information; and applying the forwarded payor loyalty information
or payor reward information to a transaction.
2. The method of claim 1, further comprising upon successful
identification of the payor, forwarding payor financial account
information from the data processing center to the party
identification apparatus.
3. The method of claim 2, further comprising forwarding payor
financial account information to a financial transaction
processor.
4. The method of claim 1, further comprising registering one or
more of a payor biometric sample, payor loyalty information, payor
reward information, payor financial account information, and a
payor personal identification number.
5. The method of claim 1, wherein applying the forwarded payor
loyalty information or payor reward information to a transaction
comprises forwarding the payor loyalty information or payor reward
information from the party identification apparatus to a point of
sale system.
6. The method of claim 1, further comprising transmitting payee
identification data to said data processing center.
7. The method of claim 6, further comprising identifying a payee
via the data processing center, wherein identifying comprises the
data processing center comparing the transmitted payee
identification data with registered payee identification data for
producing either a successful or failed identification of the
payee.
8. A method for tokenless authorization of an electronic payment,
the method comprising: gathering via a party identification
apparatus a biometric sample from a payor; transmitting the
gathered payor biometric sample via a communication line to a data
processing center; identifying the payor via the data processing
center, wherein identifying comprises the data processing center
comparing the gathered biometric sample with a registered biometric
sample for producing either a successful or failed identification
of the payor; and wherein upon successful identification of the
payor; forwarding payor financial account information and one or
more of payor loyalty information and payor reward information from
the data processing center to the party identification apparatus;
applying the forwarded payor loyalty information or payor reward
information to a transaction; and forwarding transaction
information to a financial transaction processor, wherein the
transaction information includes the payor financial account
information and a transaction amount.
9. The method of claim 8, wherein forwarding payor financial
account information from the data processing center to the party
identification apparatus comprises forwarding information
pertaining to one or more payor financial accounts.
10. The method of claim 9, further comprising displaying via the
party identification apparatus information pertaining to one or
more payor financial accounts and receiving a selection of a payor
financial account.
11. The method of claim 8, wherein the payor financial account
information forwarded to the financial transaction processor
includes a selected payor financial account.
12. The method of claim 8, further comprising registering one or
more of a payor biometric sample, payor financial account
information, payor loyalty information, payor reward information,
and a payor personal identification number.
13. The method of claim 8, wherein applying the forwarded payor
loyalty information or payor reward information to a transaction
comprises forwarding the payor loyalty information or payor reward
information from the party identification apparatus to a point of
sale system.
14. The method of claim 8, further comprising transmitting payee
identification data to said data processing center.
15. The method of claim 14, further comprising identifying a payee
via the data processing center, wherein identifying comprises the
data processing center comparing the transmitted payee
identification data with registered payee identification data for
producing either a successful or failed identification of the
payee.
16. A tokenless authorization system for a loyalty or reward
transaction, the system comprising: a computer data processing
center comprising a database storing a registration biometric
sample associated with at least one or more of a loyalty
information and reward information; a party identification
apparatus having a biometric sensor for input of a biometric
sample; a communication line for transmission of a registration
biometric sample and bid biometric sample obtained by the party
identification apparatus to the data processing center; a
comparator engine for comparing a bid biometric sample to at least
one registration biometric sample; and a means coupled to the party
identification apparatus for receiving a message containing one or
more of payor loyalty information and payor reward information and
forwarding one or more of payor loyalty information and payor
reward information to a point of sale system, the tokenless
authorization system being arranged so that the message containing
one or more of payor loyalty information and payor reward
information is sent from the data processing center to the party
identification apparatus upon a successful comparison of a bid
biometric sample and a registration biometric sample.
17. The system of claim 16, wherein the payor registration
biometric sample stored in the database is further associated with
payor financial account information.
18. The system of claim 16, wherein the tokenless authorization
system is further arranged so that the message containing one or
more of payor loyalty information and payor reward information
further comprises payor financial account information.
19. The system of claim 18, wherein payor financial account
information includes information pertaining to one or more payor
financial accounts.
20. The system of claim 18, further comprising a means coupled to
the party identification apparatus for transmitting payor financial
account information and a transaction amount from the party
identification apparatus to a financial transaction processor to
authorize a payment from a payor financial account indicated by the
payor financial account information.
Description
CROSS REFERENCE
[0001] This application is a continuation of co-pending application
Ser. No. 11/109,096, filed Apr. 18, 2005, now U.S. Pat. No.
7,536,352, to issue May 19, 2009, which is a continuation of
application Ser. No. 09/731,536, filed on Dec. 6, 2000, now U.S.
Pat. No. 6,950,810, which is a continuation-in-part of application
Ser. No. 09/239,570, filed on Jan. 29, 1999, now U.S. Pat. No.
6,269,348, which is a continuation of application Ser. No.
08/705,399, filed on Aug. 29, 1996 now U.S. Pat. No. 5,870,723,
which is a continuation-in-part of application Ser. No. 08/442,895
filed on May 17, 1995, now U.S. Pat. No. 5,613,012, which is a
continuation-in-part of application Ser. No. 08/345,523, filed on
Nov. 28, 1994, now U.S. Pat. No. 5,615,277, all commonly assigned,
and all incorporated by reference herein.
FIELD OF THE INVENTION
[0002] This invention relates to the field of tokenless biometric
financial transactions. Specifically, this invention is directed
towards a system and method of using biometrics for processing
electronic financial transactions such as on-line debit, off-line
debit and credit transactions without requiring the user to
directly use or possess any man-made tokens such as debit or credit
cards or checks. For any transaction designated to be processed as
an electronic credit or debit, this invention provides a user,
whether an individual or a business, with the ability to pay for
goods and services either at the retail point-of-sale ("POS"), at
an automated teller machine ("ATM") or over the internet using only
a biometric.
BACKGROUND
[0003] The use of a token, an inanimate object that confers a
capability to the buyer presenting it, is pervasive in today's
electronic financial world. Whether a consumer is buying groceries
with a debit card or shopping in a department store with a credit
card, at the heart of that transaction is a money transfer enabled
by a token, which acts to identify both the consumer as well as the
financial account being accessed.
[0004] Traditionally, a person must directly possess a man-made
personalized token whenever attempting authorization for an
electronic financial transaction. Tokens such as magnetic ink
encoded paper checks, smart cards, magnetic swipe cards,
identification cards or even a personal computer programmed with
resident user-specific account data, are "personalized" because
they are each programmed or encoded with data that is unique and
personalized to the authorized user. For examples: at a retail
point-of-sale, the user directly possesses and physically presents
personalized credit or debit cards encoded with his unique account
data to the merchant; or, over the internet, the user directly
possesses and electronically presents his personal computer's
resident user-unique account data to the remote merchant. By
contrast, as the disclosed invention is completely tokenless, it
does not require the user to directly possess, carry or remember
any personalized token that can be lost, stolen or damaged.
[0005] The sole functions of such tokens are to attempt to identify
both the user and the financial account being accessed to pay for
the transaction. However, these tokens can be easily exchanged,
either knowingly or unknowingly, between users, thereby de-coupling
them from the original intended user. Because these encoded credit
or debit cards, identification cards or personal computers storing
resident user data are ubiquitous in today's consumer and business
transactions as verification of the submitter's check writing
authority, and the attendant inconveniences and security
vulnerabilities of such tokens are widespread.
[0006] Credit cards can easily be turned into cash if the card
falls into the wrong hands. While theft of a token constitutes the
majority of fraud in the system, fraud from counterfeit credit
cards is rising rapidly. Counterfeit credit cards are manufactured
by a more technically sophisticated criminal who acquires a
cardholder's valid account number, produces a valid-looking
counterfeit card, encodes the magnetic strip, and embosses the
counterfeit plastic card with the account number. The card is then
repeatedly presented to merchants until the account's credit limit
is reached. Another form of loss is caused by a criminal seller or
his employees who surreptitiously obtains the cardholder's account
number and enter fictitious transactions against the card and then
take cash out of the till. It is estimated that losses due to all
types of fraud exceed one billion dollars annually.
[0007] Generally, debit cards are used in conjunction with a
personal identification number (PIN). However, various strategies
have been used to obtain PINs from unwary cardholders. These
techniques range from Trojan horse automated teller machines in
shopping malls that dispense cash but record the PIN, to fraudulent
seller point-of-sale devices that also record the PIN, to criminals
with binoculars that watch cardholders enter PINs at ATMs. The
subsequently manufactured counterfeit debit cards are then used in
various ATM machines until the unlucky account is emptied.
[0008] Customer fraud, for both credit and debit cards, is also on
the rise. Customers intent on this sort of fraud can claim that
they lost their card, say that their PIN was written on the card,
and then withdraw money from their account using card, and then
refuse to be responsible for the loss.
[0009] The financial industry is well aware of the trends in fraud,
and is constantly taking steps to improve the security of the card.
However, the linkage between the buyer and his token is tenuous,
and that is the fundamental reason behind card fraud today.
[0010] One possible solution to stolen-card fraud involves placing
PIN protection for magnetic stripe credit cards, much as debit
cards have PINs today. This will raise the administrative costs for
each card, since cardholders will undoubtedly wish to select their
own PIN for each of their 3.4 cards (the national average). In
addition, this solution still doesn't address the problem of
counterfeit cards.
[0011] Another solution that solves both stolen-card fraud and
greatly reduces counterfeit-card fraud involves using a smartcard
that includes either a biometric or a PIN. In this approach,
authenticated biometrics are recorded from a user of known identity
and stored for future reference on a token. In every subsequent
access attempt, the user is required to physically enter the
requested biometric, which is then compared to the authenticated
biometric on the token to determine if the two match in order to
verify user identity.
[0012] Various token-based biometric technologies have been
suggested in the prior art, using smart cards, magnetic swipe
cards, or paper checks in conjunction with fingerprints, hand
prints, voice prints, retinal images, facial scans or handwriting
samples. However, because the biometrics are generally either: a)
stored in electronic and reproducible form on the token itself,
whereby a significant risk of fraud still exists because the
comparison and verification process is not isolated from the
hardware and software directly used by the payor attempting access,
or; b) used in tandem with the user directly using magnetic swipe
cards, paper checks or a PC with the user's financial data stored
resident therein. Examples of this approach to system security are
described in U.S. Pat. No. 4,821,118 (Lafreniere); U.S. Pat. No.
4,993,068 (Piosenka et al.); U.S. Pat. No. 4,995,086 (Lilley et
al.); U.S. Pat. No. 5,054,089 (Uchida et al.); U.S. Pat. No.
5,095,194 (Barbanell); U.S. Pat. No. 5,109,427 (Yang); U.S. Pat.
No. 5,109,428 (Igaki et al.); U.S. Pat. No. 5,144,680 (Kobayashi et
al.); U.S. Pat. No. 5,146,102 (Higuchi et al.); U.S. Pat. No.
5,180,901 (Hiramatsu); U.S. Pat. No. 5,210,588 (Lee); U.S. Pat. No.
5,210,797 (Usui et al.); U.S. Pat. No. 5,222,152 (Fishbine et al.);
U.S. Pat. No. 5,230,025 (Fishbine et al.); U.S. Pat. No. 5,241,606
(Horie); U.S. Pat. No. 5,265,162 (Bush et al.); U.S. Pat. No.
5,321,242 (Heath, Jr.); U.S. Pat. No. 5,325,442 (Knapp); and U.S.
Pat. No. 5,351,303 (Willmore).
[0013] Uniformly, the above patents disclose financial systems that
require the user's presentation of personalized tokens to authorize
each transaction, thereby teaching away from tokenless biometric
financial transactions. To date, the consumer financial transaction
industry has had a simple equation to balance: in order to reduce
fraud, the cost and complexity of the personalized token directly
possessed by the user must increase.
[0014] Also, the above patents that disclose commercial transaction
systems teach away from biometric recognition without the use of
tokens or PINs. Reasons cited for such teachings range from storage
requirements for biometric recognition systems to significant time
lapses in identification of a large number of individuals, even for
the most powerful computers.
[0015] Unfortunately, any smartcard-based system will cost
significantly more than the current magnetic stripe card systems
currently in place. A PIN smartcard costs perhaps $3, and a
biometric smartcard will cost $5. In addition, each point-of-sale
station would need a smartcard reader, and if biometrics are
required, a biometric scanner will also have to be attached to the
reader. With 120 million cardholders and 5 million stations, the
initial conversion cost is from two to five times greater than the
current annual fraud losses.
[0016] This large price tag has forced the industry to look for new
ways of using the power in the smartcard in addition to simple
commercial transaction. It is envisioned that in addition to
storing credit and debit account numbers and biometric or PIN
authentication information, smart cards may also store phone
numbers, frequent flyer miles, coupons obtained from stores, a
transaction history, electronic cash usable at tollbooths and on
public transit systems, as well as the buyer's name, vital
statistics, and perhaps even medical records.
[0017] The net result of "smartening" the token is centralization
of function. This looks good during design, but in actual use
results in increased vulnerability for the consumer. Given the
number of functions that the smartcard will be performing, the loss
or damage of this monster card will be excruciatingly inconvenient
for the cardholder. Being without such a card will financially
incapacitate the cardholder until it is replaced. Additionally,
losing a card full of electronic cash will also result in a real
financial loss as well.
[0018] Thus, after spending vast sums of money, the resulting
system will definitely be more secure, but will result in heavier
and heavier penalties on the consumer for destruction or loss of
the card.
[0019] To date, the consumer financial transaction industry has had
a simple equation to balance: in order to reduce fraud, the cost of
the card must increase. As a result, there has long been a need for
an electronic financial transaction system that is highly
fraud-resistant, practical, convenient for the consumer, and yet
cost-effective to deploy.
[0020] As a result, there is a need for a new electronic financial
transactions system that is highly fraud-resistant, practical,
convenient for the consumer, and yet cost-effective to deploy. More
specifically, there is a need for an electronic financial
transaction system that relies solely on a payor's biometric for
transaction authorization, and does not require the payor to
directly possess any personalized man-made memory tokens such as
smart cards, magnetic swipe cards, encoded paper checks or personal
computers for identification.
[0021] Lastly, such a system must be affordable and flexible enough
to be operatively compatible with existing networks having a
variety of electronic transaction devices and system
configurations. Accordingly, it is the objective of the present
invention to provide a new system and method of tokenless biometric
financial transactions.
[0022] There is also a need for an electronic financial transaction
system that uses a strong link to the person being identified, as
opposed to merely verifying a buyer's possession of any physical
objects that can be freely transferred. This will result in a
dramatic decrease in fraud, as only the buyer can authorize a
transaction.
[0023] Accordingly, it is an objective of the present invention to
provide a new system and method of tokenless biometric financial
transactions for electronic credit and debit.
[0024] Another objective of the invention is to provide an
electronic credit and debit financial transaction system and method
that eliminates the need for a payor to directly possess any
personalized man-made token which is encoded or programmed with
data personal to or customized for a single authorized user.
Further, it is an objective of the invention to provide an
electronic financial transaction system that is capable of
verifying a user's identity based on one or more unique
characteristics physically personal to the user, as opposed to
verifying mere possession of personalized objectives and
information.
[0025] Another objective of the invention is to provide an
electronic financial transaction system that is practical,
convenient, and easy to use, where payors no longer need to
remember personal identification numbers to access their financial
accounts.
[0026] Another objective of the invention is to provide increased
security in a very cost-effective manner, by completely eliminating
the need for the payor to directly use ever more complicated and
expensive personalized tokens.
[0027] Another objective of the invention is to provide an
electronic financial transaction system that is highly resistant to
fraudulent access attempts by unauthorized users.
[0028] Another objective of the invention is to authenticate the
system to the payor once the electronic financial transaction is
complete, so the payor can detect any attempt by criminals to steal
their authentication information.
[0029] Another objective of the invention is that the payee be
identified by an electronic third party identicator (ETPI), wherein
the payee's identification is verified. Therefore, the payee would
register with the ETPI payee identification data, which optionally
comprises, a payee hardware ID code, a payee phone number, a payee
email address, a payee digital certificate code, a payee financial
account number, a payee biometric, or a payee biometric and PIN
combination.
[0030] Still, another objective of the invention is to be added in
a simple and cost-effective manner to existing terminals currently
installed at points of sale and used over the Internet around the
world.
[0031] Yet another objective of the invention is to be efficiently
and effectively operative with existing financial transactions
systems and protocols, specifically as these systems and protocols
pertain to processing of electronic credit and debits.
[0032] A final objective of the invention is to make use of
existing credit and debit authorization systems already present at
points of sale.
SUMMARY
[0033] The invention satisfies these needs by providing a method
and device for tokenless authorization of an electronic payment
between a payor and a payee using an ETPI and at least one payor
bid biometric sample. The method comprises a payor registration
step, wherein the payor registers with an ETPI at least one
registration biometric sample, and at least one payor financial
account identifier. In a payee registration step, the payee
registers a payee identification data with the ETPI. At least one
bid biometric sample is then obtained from the payor's person in a
collection step. Preferably in one transmission step the payee bid
identification data and payor bid biometric sample are
electronically forwarded to the third party electronic identicator.
A comparator engine or the identification module of the third party
identicator compares the bid biometric sample with at least one
registered biometric sample for producing either a successful or
failed identification of the payor. The comparator engine also
compares the payee's bid identification data with registered payee
identification data for producing either a successful or failed
identification of the payee. Once the third party identicator
successfully identifies the payor and payee, at least one payor
financial account identifier is electronically forwarded to the
payee. An electronic financial transaction is then formed between
the payor and the payee, comprising a transaction amount and a
payor financial account identifier. The transaction amount may
comprise a "cash back" amount in addition to the purchase amount.
This financial transaction is electronically forwarded to a
financial transaction processor for authorization. Thus, upon
successful identification of the payor and payee, and upon
successful authorization of the financial transaction by the
financial transaction processor, a biometric-based authorization of
an electronic payment is made without requiring the payor to
present any personalized man-made tokens such as magnetic swipe
cards or smartcards to transfer funds from the payor's financial
credit/debit account to the payee's financial account.
[0034] The payee identification data comprises any one of the
following: a payee hardware ID code, a payee telephone number, a
payee email address, a payee digital certificate code, a payee
account index, a payee financial account number, a payee biometric,
and a payee biometric and PIN combination.
[0035] Optionally, in a payor account selection step, after the
payor has been successfully identified in the payor identification
step, the ETPI presents at least one identifier for a financial
account which was registered by the payor with the ETPI for
selection by the payor of one of the financial accounts for
debiting.
[0036] The present invention is significantly advantageous over the
prior art in a number of ways. First, it is extremely easy and
efficient for people to use because it eliminates the need to
directly possess any personalized tokens in order to access their
authorized electronic financial accounts.
[0037] The present invention eliminates all the inconveniences
associated with carrying, safeguarding, and locating such tokens.
It thereby significantly reduces the amount of memorization and
diligence traditionally and increasingly required of people by
providing protection and access to all financial accounts using
only a biometric. The buyer is now uniquely empowered, by means of
this invention, to conduct his personal and/or professional
electronic transactions at any time without dependence upon tokens,
which may be stolen, lost or damaged.
[0038] The invention is convenient to sellers and financial
institutions by making electronic credit and debit purchases and
other financial transactions less cumbersome and more spontaneous.
The paperwork of financial transactions is significantly reduced as
compared to standard credit and debit transactions wherein the
copies of the signed receipt must often be retained by the seller,
financial institutions and the buyer.
[0039] Overall, because the method and system of this invention are
designed to provide a person with simultaneous direct access to all
or any number of his financial accounts, the need for transactions
involving credit cards, debit cards, paper money, credit drafts and
the like can be greatly reduced, thereby reducing the cost of
equipment and staff required to collect, account, and process such
transactions.
[0040] Further, the present invention will mitigate the substantial
manufacturing and distributing costs of issuing and reissuing
personalized tokens such as magnetic swipe cards and smart cards,
thereby providing further economic savings to issuing banks,
businesses, and ultimately to consumers.
[0041] Moreover, the invention is markedly advantageous and
superior to existing systems in being highly fraud resistant. As
discussed above, present authorization systems are inherently
unreliable because they base determination of a user's identity on
the physical presentation of a manufactured personalized token
along with, in some cases, information that the user knows.
Unfortunately, both the token and information can be transferred to
another person through loss, theft or by voluntary action of the
authorized user.
[0042] Thus, unless the loss or unintended transfer of these items
is realized and reported by the authorized user, anyone possessing
such items can be recognized by existing authorization systems as
the buyer to whom that token and its corresponding financial
accounts are assigned. Even appending the need for presentation of
a biometric in conjunction with such personalized tokens is
severely flawed, since if the authorized buyer is unable to present
the requisite token at the time of transaction, he will be unable
to access his financial accounts. As such, these complex
arrangements are ineffective, since the security they intend to
provide can easily block an authorized user from using his own
rightful financial resources by virtue of his personalized token
having been lost, stolen or damaged.
[0043] By contrast, the present invention virtually eliminates the
risk of denying access to rightful users while simultaneously
protecting against granting access to unauthorized users. By
determining identity and transaction authorization solely from an
analysis of a user's unique biometric characteristics, this
invention creates a highly secure system that maintains optimal
convenience for both buyers and sellers to transaction their
electronic business anytime, anywhere.
[0044] Additionally, the invention leverages the existing financial
transaction processing networks and business relationships already
existing at point-of-sale for many merchants. In this way, the
invention is easy to integrate with a merchant's existing
operations.
[0045] These and other advantages of the invention will become more
fully apparent when the following detailed description of the
invention is read in conjunction with the accompanying
drawings.
BRIEF DESCRIPTION OF THE DRAWINGS
[0046] FIG. 1 is a schematic diagram of the preferred embodiment of
a Party Identification Apparatus (PIA) with a biometric sensor and
key pad.
[0047] FIG. 2 is a block diagram that shows the connection between
the PIAs to a local router and a network operations center
according to the invention.
[0048] FIG. 3 shows an alternative embodiment where the PIAs are
connected to the Data Processing Center (DPC) using a cellular
digital packet data.
[0049] FIG. 4 is a block diagram of a preferred embodiment of the
Data Processing Center (DPC) according to the present invention,
showing the connections between its components.
[0050] FIG. 5 is a block diagram which shows a method by which the
transaction processor determines a Biometric-PIN from the
Biometric-PIN Identification subsystem is responsible for a given
subdivision of the biometric database.
[0051] FIG. 6 is a flowchart which shows the overall preferred
process according to the invention where a biometric sample and PIN
are used by the tokenless system to authorize an automated clearing
house (ACH) transaction.
[0052] FIG. 7 is a diagram of the preferred transaction flow
according to the invention in a retail point-of-sale
transaction.
[0053] FIG. 8 is a block diagram that shows the components that
comprise the system according to the invention in a retail
point-of-sale transaction at a typical supermarket or other
multi-lane retailer.
DETAILED DESCRIPTION
[0054] The invention provides a cardless biometric method for
authorizing electronic payments using credit and debit accounts
either at the retail point-of-sale or over the Internet. It is the
essence of this invention that the payor not be required to
directly use any man-made personalized token in order to effect the
transaction. A computer system is used to accomplish these
goals.
[0055] A credit account is defined as an account that allows
authorization and settlement of electronic payments as issued by
such entities as VISA, MasterCard, Discover, American Express, or
an in-house credit account issued by a retailer such as Macy's.
Issuers of credit accounts lend money to payors, often charge
interchange fees to payees, and are responsible for approving or
denying transactions. Off-line debit accounts are also defined as
credit accounts even though the funds are deposited by a payor
instead of a line of credit from an issuer.
[0056] A debit account is defined as an account that holds money
deposited by a payor available for immediate debit in real time,
also known in the industry as on-line debit. These are often
checking accounts. On-line debit transactions require a PIN for
identification of the payor.
[0057] A stored value account is an account in which a consumer can
deposit money for later withdrawal, often via an electronic payment
system of some sort.
[0058] A financial account is a credit account, debit account,
stored value account, or any other type of financial account from
which funds may be drawn. A financial account identifier is any
mechanism that can be used to uniquely identify a financial
account. Typical examples of financial account identifiers include
checking account numbers, savings account numbers, credit card
numbers, debit card numbers and stored value card or account
numbers.
[0059] A financial account identifier can also be the data stored
on track 1 or 2 of a standard magnetic stripe credit card or the
American Bankers Association routing code and account number stored
in magnetic ink at the bottom of a paper check.
[0060] A financial transaction processor is an entity that
authorizes and/or settles electronic financial transactions. FTPs
are often called "acquirers" or "processors" in the industry.
Examples include First Data.RTM., Efunds.RTM., Vital Processing
Services.RTM. and many others.
[0061] The tokenless authorization system or the third party
identicator comprises the following components: [0062] Party
Identification Apparatus (PIA) [0063] Communication lines [0064]
Data Processing Center (DPC)
[0065] These components together allow a payor to originate an
electronic payment without requiring the payor to carry driver's
licenses, credit cards, check guarantee cards, or other forms of
identity.
[0066] Party Identification Apparatus (PIA)
[0067] The PIA 101 is a device that gathers identity information
for use in authorizing electronic payments. Each PIA conducts one
or more of the following operations: [0068] gather biometric input
from a payor or payee [0069] gather a PIN code or password from a
payor or payee [0070] secure communication between PIA and DPC
using encryption [0071] secure storage of secret encryption keys
[0072] store and retrieve a unique payee PIA hardware
identification code [0073] secure enclosure & components from
unauthorized tampering [0074] display information, allow parties to
approve or cancel an electronic payment [0075] scan a magnetic
stripe card [0076] store, verify, and retrieve a payee digital
identification code [0077] allow parties to select among choices of
payor financial accounts
[0078] A preferred embodiment containing these components is shown
in FIG. 1.
[0079] Biometric input is gathered using a biometric sensor 102
located within the PIA 101 operating under control of a
microprocessor 103. Biometric sensor 102 is a finger image sensor,
however it is understood that other types of biometric sensors such
as iris scan and others are also used.
[0080] For PIAs requiring a fingerprint sensor 102, the PIA
preferably has a biometric fraud detection unit that will assure
that any biometric input gathered from the biometric sensor is from
a real physical person, instead of a copy or replica. Preferably
for the finger image sensor, this is a blood flow detector 104.
Other types of biometric sensors can be used, such as a
fingerprint, facial scan, retinal image, iris scan or voice print.
For example, a voice sensor can be used in a telephone sales
system.
[0081] For systems employing a PIN, PIN input is preferably
gathered using a keypad or PIN pad 106 that is also located
securely inside the PIA and coupled to the microprocessor 103.
[0082] Communication security is provided by encryption using
unique secret keys known only to that specific PIA and the DPC, and
the DES encryption algorithm, preferably triple-encrypted. Triple
encryption means successive encrypt/decrypt/encrypt operations
using two distinct 56-bit DES keys. This provides significantly
higher security than a single encryption operation with one 56-bit
DES key. Alternately, a public/private key system may also be used
to encrypt information that passes between PIA and DPC. Both DES
and public key encryption are well known in the industry.
[0083] The PIA also has secure memory 108 that can store and
retrieve the unique secret encryption keys used to enable secure
communications with the DPC. In this embodiment, this memory is
battery backed-up RAM that is set up to be erased whenever
tamper-detect circuitry 112 coupled to the microprocessor reports
that tampering has been detected.
[0084] To use encryption keys, a key management system must be
employed to assure that both sender and receiver are using the same
key. When using DES, a preferred key management system is DUKPT,
which is well known in the industry. DUKPT is designed to provide a
different DES key for each transaction, without leaving behind the
trace of the initial secret key. The implications of this provision
are that even successful capture and dissection of a PIA will not
reveal messages that have previously been sent, a very important
goal when the effective lifetime of the information transmitted is
years. DUKPT is fully specified in ANSI X9.24. The DUKPT key table
is stored in the secure memory 108.
[0085] Each PIA preferably has a hardware identification code that
is registered with the DPC at the time of manufacture. This makes
the PIA uniquely identifiable to the DPC in all transmissions from
that device. This hardware identification code is stored in
write-once or read-only memory 110.
[0086] PIA physical security is assured by standard mechanisms.
Preferably, these comprise tamper-detect circuitry 112, an
enclosure that cannot be easily opened without visibly injuring the
enclosure, erasable memory for critical secrets such as encryption
keys, write-once or read-only memory for hardware identification,
tight integration of all components, and "potting" of exposed
circuitry.
[0087] Information such as the amount of a transaction, the
identity of a payee, the list of credit/debit accounts for a payor
to select from, or other transaction-related information is
displayed using an integrated LCD screen 114. It is preferable that
the LCD screen be connected securely to the other components in the
PIA to maintain security.
[0088] Approval or cancellation of an electronic payment is done
using the PIA keypad 106.
[0089] The magnetic stripe reader 120 is used to read the account
information that is encoded on the magnetic stripe of a credit or
debit card. This reader is used during initial registration to link
a payor's financial account information to the biometric
identity.
[0090] Optionally, the PIA also validates public key digital
certificates. In one embodiment, public keys of a particular
certifying authority are initially stored in the PIA at the time of
construction. This capability provides the mechanism to verify a
payee's digital certificates that are signed by the certifying
authority.
[0091] The PIA also optionally displays a list of payor financial
accounts on the LCD screen and provides for selection of accounts
using the keypad. Specific logos provided by each card issuer are
preferably displayed in place of the account number, so that the
payor can select which financial account the electronic payment
will come from using the keypad, without disclosing the account
number. In another embodiment, the PIA can simply display a list of
financial account types (e.g., credit, debit, stored value) and the
consumer can select the type of account to use in the
transaction.
[0092] The PIA preferably has a serial port or ethernet port 116
used for communication with the DPC. When ethernet is used, the PIA
is connected to an existing local area network already present with
a merchant's store, or a separate local area network used only for
PIAs can be used. Where the serial port is used, the PIA is
connected to existing point-of-sale equipment or an electronic cash
register at the merchant's store. This equipment or cash register
can then communicate with the DPC.
[0093] Note that not all PIAs have displays, keypads or card
readers. In an embodiment that is preferable for some merchant
locations, the PIA consists only of a fingerprint or other
biometric sensor, a microprocessor, memory, a serial port, and an
ethernet port. The serial port is used to attach the PIA to
existing point-of-sale equipment (e.g., a Verifone Everest Plus or
Checkmate CM2001) or electronic cash registers. The ethernet port
is used to communicate with the DPC via the merchant's existing
in-store local area network. This embodiment makes use of the
display and keypad on the existing POS equipment, thus eliminating
the need to have a display and keypad on the PIA.
[0094] Although a preferred embodiment is described above, there
are many different variations on specific PIA implementations.
Fundamentally any device that is secure, can identify a person or
entity with a high degree of certainty, and can connect to the DPC
via some form of communication line can serve as a PIA.
[0095] In some embodiments, specifically the home use and public
use instances, the PIA hardware identification code is not used to
identify either the payor or the payee.
[0096] Communication Lines
[0097] Communications between the PIA and the DPC can occur via
many different communication methods. Most depend on the particular
communication networks already deployed by the organization or
retailer that deploys the transaction authorization system.
[0098] In an embodiment shown in FIG. 2, typical of use of the
invention at a supermarket chain or other multi-lane retail chain,
multiple PIAs 101 are connected via an in-store Ethernet or other
local area network to a local router 202, which is itself connected
to a network operations center (NOC) 203 via frame relay lines. In
the illustrated embodiment, at least one DPC 204 is located at the
NOC. In other embodiments, the DPC is located elsewhere, and
connected to the NOC via leased lines. Messages are sent from PIA
to the DPC using UDP/IP or TCP/IP over this network.
[0099] In another embodiment shown in FIG. 3, the PIAs 101 are
connected via a cellular digital packet data (CDPD) modem to a CDPD
provider 302, who provides IP connectivity from the PIA to an
intranet to which at least one DPC 204 is coupled.
[0100] In yet another embodiment, a PIA is connected via the
Internet, as is at least one DPC. TCP/IP or UDP/IP is used to
transmit messages from PIA to DPC. There are many different ways to
connect PIA to DPC that are well understood in the art.
[0101] Data Processing Center
[0102] Data Processing Centers (DPC) 204 serve to identify the
payor and the payee in a transaction, to retrieve the payor's
financial account information, and to forward the financial account
information to the payee such that the payee can be paid.
[0103] As seen in FIG. 4, the DPC 204 is connected to the Internet
or intranet 425 using a firewall machine 427 that filters out all
messages that are not from legitimate PIA devices 101. Messages are
then sent to a transaction processor (TP) 426, which is responsible
for overseeing the steps required to process the entire
transaction.
[0104] In a preferred embodiment, the messages are encrypted before
being sent, and decrypted when they reach the DPC. For this, the
transaction processor uses the decryption module (DM) 428, which
utilizes the hardware identification code of the PIA to identify
the encryption codes that is required to decrypt the message from
the PIA.
[0105] Once decrypted, the identities of both parties to the
transaction are determined using the identification module (IM), or
comparator engine 430. Once identified, the TP 426 retrieves the
payor's financial account identifiers. The TP then sends this
information back to the originating PIA 101. If the payor has
registered multiple financial accounts, a list of these accounts is
displayed so that the payor can select the account he or she wishes
to use. The PIA then forwards information about the selected
account (e.g., account number, expiration date, or track 1/track 2
data) to the payee for payment. In the case of a supermarket or
other multi-lane retailer, this forwarding procedure comprises
transmitting the account information to existing point-of-sale
systems, e.g., a Verifone point-of-sale terminal. The point-of-sale
terminal then forwards this information to an electronic cash
register, which in turn forwards it to an in-store controller. This
can be done without displaying the payor's account information
(especially account number) to store clerks. In any case, the
store's existing payment systems handle the actual authorization
and settlement of the transaction, just as if the payee had
physically swiped a card at a point-of-sale.
[0106] Each identification attempt (successful or not) is logged in
the logging facility (LF) 436.
[0107] In a preferred embodiment, more than one DPC provides fault
tolerance from either natural or man-made disasters. In this
embodiment, each DPC uses a backup power generator, redundant
hardware, mirrored databases, and other standard fault tolerant
equipment known in the industry.
[0108] Decryption Module (DM)
[0109] In a preferred embodiment, all messages the DPC 204
receives, with the exception of those not constructed by a PIA 101,
contain a PIA hardware identification code, a sequence number, and
a Message Authentication Code (MAC). (Message authentication codes,
also known as cryptographic checksums, well known in the
transaction industry, are used to assure that any changes to the
content of the message will be detectable by the entity receiving
the transmission.). The DM 428 validates the message's MAC and then
checks the sequence number for that particular PIA. If the DM
determines that both the MAC and the sequence number are valid, the
DM uses the unique secret key for that particular PIA to decrypt
the message. For the decryption to function properly, the DM must
contain a copy of each PIA's DUKPT key table.
[0110] If the decryption operation fails, or if the MAC check
fails, the message is considered an invalid message. The TP logs a
warning to the LF, terminates processing for the message, and
returns an error message to the originating PIA.
[0111] Each message that TP 426 receives preferably contains a
response key stored in the encrypted section of the message. Before
the TP replies to a message that includes a response key, it
instructs the DM to encrypt the response message with that response
key. The DM also generates a MAC for the response and appends it to
the message.
[0112] Preferably, error messages are not encrypted, although the
DM can include a MAC for message authentication. Such messages
never include confidential information. However, most response
messages include a status or response codes that can indicate
whether the request succeeded or not.
[0113] Identification Module (IM)
[0114] Party identification occurs in different ways, depending on
the identification information that is provided by the PIA. The
identification module 430 has subsystems for each type of
information that is provided, and each subsystem is highly
optimized to provide rapid identification as outlined below.
[0115] In one embodiment, the ID module 430 detects payors or
payees that re-register with the system by conducting a
re-registration check. Given a particular registration biometric
sample submitted by a person attempting to register with the
system, the ID module determines if that person has ever been
registered previously by comparing the registration biometric
sample with other biometric samples previously registered. If a
match occurs, the registration is rejected.
[0116] In a preferred embodiment, identification module 430
comprises subsystems that can identify parties from the following
information: [0117] biometric data and PIN [0118] biometric data
alone [0119] digital identification (digital certificates) [0120]
PIA hardware identification code The content of the message is
parsed to determine which subsystem is used.
[0121] Biometric-PIN Identification Subsystem (BPID)
[0122] In a preferred embodiment, the BPID subsystem 504 comprises
at least two BPID processors 506, 508, 510, each of which is
capable of identifying parties from their biometric and PIN codes.
In this embodiment, a non-unique PIN and a biometric sample are
preferably employed for each user.
[0123] Preferably, the database of parties identifiable from
biometric-PIN combinations is distributed equally across all BPID
processors. Each processor is then responsible for a subset of
identifications.
[0124] In FIG. 5, TP 426 determines which biometric-PIN from the
BPID subsystem 504 is responsible for a given subdivision of the
biometric database. In one embodiment, one BPID processor 506 is
responsible for identifying people with PINs N1-N10, another BPID
processor 508 is responsible for identifying PINs N11-N20, and a
third BPID processor 510 is responsible for identifying PINs
N21-N30. For example, all messages from the PIA containing a PIN
that equals the number 30 would be routed to BPID processor 510 for
identification of the payor.
[0125] Once a BPID processor receives a bid biometric sample and
PIN for identification, the processor searches through its
database, retrieving all registered biometric samples that match or
correspond to that particular bid PIN. Once all corresponding
registered biometric samples are retrieved, the processor compares
the bid biometric from the message to all retrieved registered
biometric samples. If a match is found, the processor transmits the
identity of the party back to TP 426. If no match is found, the
processor transmits a "party not identified" message back to the
TP.
[0126] Biometric Identification Subsystem (BID)
[0127] In another embodiment, the BID subsystem comprises at least
two BID processors, each of which is capable of identifying parties
only from their biometric sample.
[0128] In one embodiment, each BID processor contains the entire
database of biometrics. To distribute the transactions evenly
across processors without undue effort, the TP determines randomly
which BID processor will be used for a given identification
request, and delegates the identification request to that BID
processor. That BID processor then performs a search of its
biometric sample database in order to find a matching registered
biometric sample.
[0129] In one embodiment, other information is present that assists
the BID processor in searching the database. For finger images,
this includes information such as the classification of the image
(whorl, arch, etc.), and other information about the finger ridge
structure that is useful for selecting out biometrics that are not
likely to match (or information on biometrics that are likely to
match). Various methods of classification for rapid search of
particular biometric databases are known in the art for example
with regard to facial imaging and iris recognition.
[0130] Biometric comparisons are often more accurate if multiple
biometrics are used. In some embodiments, multiple biometrics are
used to identify individuals more rapidly and more accurately.
[0131] Digital Identification Subsystem (DID)
[0132] In a preferred embodiment, the digital identification
subsystem comprises multiple processors, each of which is capable
of identifying a payee from their digital certificates. In this
embodiment, digital certificates are used to perform digital
identification of the payee. Preferably this includes corporate web
site addresses and certifying authorities only. Where possible,
people provide biometrics as a means of identification, while
computers provide digital certificates.
[0133] A digital certificate uniquely identifies a party. The major
difficulty is verifying that a particular digital certificate is
valid. This requires a public key from the certifying authority
that issued that particular digital certificate. This requires that
the digital identification subsystem have a list of certifying
authorities and the public keys used to validate the digital
certificates they issue. This table must be secure, and the keys
stored therein must be kept up to date. These processes and others
relating to the actual process for validating digital certificates
are well understood in the industry.
[0134] PIA Hardware Identification Subsystem (PHI)
[0135] In a preferred embodiment, PIA hardware identification codes
are translated into payee identification by the PHI subsystem. This
subsystem maintains a list of all PIAs ever manufactured.
Preferably, when a particular payee, e.g., a merchant, purchases a
PIA, that payee's identity is linked to that PIA. Any transactions
that originate from that PIA are assumed to be destined for the
party that purchased the PIA.
[0136] Account Selector Subsystem (AS)
[0137] Referring to the AS 432 in FIG. 4, the account selection
process varies depending on the party being identified. Where the
payor has registered only one financial account, that account
number is automatically selected by the AS for forwarding to the
payee.
[0138] In the cases where a payor has registered several financial
accounts, the AS processor retrieves a list of all designated
financial account identifiers and transmits them back to the PIA
for selection by the payor.
[0139] In one embodiment, a PIA or POS terminal allows the payor to
pre-select which of multiple accounts should be used by pressing a
"credit," "debit," "checking," or "stored value" key on the PIA or
POS terminal before attempting to be identified. In this
embodiment, the PIA notes in its identification request that only
the specified account should be retrieved.
[0140] In another embodiment, loyalty or reward information is also
stored in the database at the DPC. In this embodiment, such loyalty
or reward information is automatically transmitted back to the PIA
along with any financial account information. In the case of a PIA
installed at a supermarket or other multi-lane retailer, the PIA
forwards this information to existing POS or electronic cash
register systems installed at the store. This procedure enables a
consumer to enjoy the use of loyalty or rewards programs without
needing to possess a store rewards card or other token.
[0141] Logging Facility
[0142] Each transaction (successful or not) is logged in the LOG
facility (LF) 436.
[0143] In a preferred embodiment, the LOG facility (LF) 436 logs
all electronic payment attempts to write-once media, so that a
record is kept of each transaction and each error that has occurred
during the operation of the tokenless authorization system.
[0144] Use-Sensitive DPC Configuration
[0145] While each DPC has some or all of the above features, in
some embodiments the system has use-sensitive data processing
capabilities, wherein multiple DPCs exist, some of which store a
subset of the total number of registered parties.
[0146] This system comprises at least one master DPC, which
contains a large subset of all parties registered with the system.
The system further comprises at least two local DPCs that are
physically apart from each other. Each local DPC contains a subset
of the parties contained within the master DPC. Data communications
lines allow messages to flow between each local DPC and the master
DPC.
[0147] In this embodiment, identification request messages are
first sent to the local DPC for processing. If a party cannot be
identified by the local DPC, the message is forwarded to the master
DPC. If the parties are identified properly by the master DPC, the
message is processed appropriately. In addition, one or both
party's identity information is transmitted from the master DPC to
the local DPC, so that the next time the parties will be
successfully identified by the local DPC.
[0148] In another embodiment of a use-sensitive DPC system, the
system further comprises a purge engine for deleting a party's
identification information from the local DPC databases. In order
to store only records for those parties who use the system with
more than a prescribed frequency and to prevent the overload of
databases with records from parties who use the system only
occasionally, the record of a party is deleted from the local DPC
databases if there has been no attempt to identify the party upon
expiration of a predetermined time limit.
[0149] In order to make communications between the master DPC and
the local DPCs secure, the system further comprises encryption and
decryption means, wherein communications between the master DPC and
local DPC are encrypted.
[0150] Registration
[0151] Parties wishing to either originate or receive electronic
payments must first register with the ETPI. The identification and
financial information registered with the system for a given party
depends on the mode used to originate or receive payment. A payor
must register at least one biometric or a biometric-PIN. Corporate
entities must register at least one digital certificate, or must
register their PIA hardware identification codes. The payor must
also register the appropriate financial account information, e.g.,
credit/debit account information or checking account
information.
[0152] To register, a payor submits a registration biometric sample
obtained from their physical person by the PIA's biometric sensor.
The PIA preferably determines that the biometric scan is
non-fraudulent, and then translates and compresses that biometric
scan into a format suitable for rapid transmission to the DPC. The
payor then preferably enters a PIN code into the PIA keypad.
[0153] Next, the person associates at least one financial account
identifier with the registration biometric sample in the system.
Preferably, in the case of a credit or debit card, this association
is accomplished by scanning a magnetic stripe card provided by the
person through a magnetic stripe card reader attached to the PIA or
point-of-sale terminal.
[0154] Preferably, an attendant verifies that the person actually
owns the financial account by comparing personal photo ID (a
driver's license, passport, ID card, etc.) to the name listed on
the registration of the financial instrument (e.g., credit/debit
card).
[0155] Once the attendant verifies the registration data and
payor's identity, the PIA transmits the registration data to the
DPC. The DPC then inserts the biometric (or biometric-PIN) into the
appropriate identification database, updates the account selector,
and enables the person to originate electronic payments.
[0156] In one embodiment, the DPC validates the financial account
data submitted during registration. This involves making certain
that the financial account being registered is a valid account.
[0157] An entity may either register at least one digital
certificate, or use at least one PIA hardware identification code
to identify itself to the DPC. Digital certificates are available
from certifying authorities, and they provide the assurance that
the entity with the certificate is the authentic owner of that
identity. These certificates contain readable text and other
information that describes the entity. This can include a corporate
logo, the address, as well as the company name.
[0158] This digital certificate is then linked to at least one
financial account. This financial account is used to deposit all
electronic payments originated by the payor to the payee when the
digital certificate is used to identify the receiving party.
[0159] The financial account identifier of the entity can be
included in the digital certificate, but this is not a preferred
embodiment, as the disclosure of the financial account is
potentially injurious to the entity.
[0160] PIA hardware identification codes are unique numbers
assigned to PIA devices at the time of manufacture.
[0161] Preferably, the security surrounding the registration of
entity digital certificates or PIA hardware identification codes to
financial account numbers is extremely strong, as this is a
potential source of large losses over a short period of time.
[0162] Transactions
[0163] Transactions optionally occur at a retail point-of-sale,
across the network from a well-known network merchant, or at a home
or public terminal from one person to another.
[0164] Retail Point-of-Sale Transactions
[0165] A typical retail point-of-sale (POS) transaction,
specifically a tokenless biometric electronic financial transaction
via a third party identicator, is shown in FIG. 6. The transaction
flow between each participant in the transaction is shown in FIG.
7. Such transactions are characterized by identifying the payor
using their biometric sample or biometric sample-PIN input on a PIA
controlled by payee. The payor is thus identified through
biometrics, while the payee is identified through the PIA's
hardware identification code. The payee and seller ID are then
transmitted to the TP to authorize the transaction.
[0166] In a preferred embodiment shown in FIG. 6, a customer
(payor) at the point-of-sale originates an electronic payment in
the following manner. First, in step 702, the payor submits a bid
biometric sample obtained from their physical person by the PIA's
biometric sensor. The PIA determines that the biometric sample is
non-fraudulent, and then translates and compresses that biometric
sample into a format suitable for rapid transmission to the
DPC.
[0167] Next, the payor enters a PIN code into the PIA keypad (step
704). At this point, the PIA transmits the biometric-PIN to the DPC
for identification, along with the PIA hardware identification code
(step 720). The DPC identifies the payor using the biometric sample
(step 706), and retrieves the list of financial accounts that the
payor has previously registered with the system. The DPC identifies
the payee using the PIA hardware identification code that was
previously registered by the payee (step 710). The DPC transmits
the list of financial accounts registered for the payor back to the
PIA (step 708). The transaction amount is entered at this time
(step 710), if not entered when the PIN is entered. The DPC
identifies the payee using the PIA hardware identification code
that was previously registered by the payee (step 712).
[0168] The PIA displays the list of financial accounts to the
payor, who then selects one of the financial accounts from which
the funds will be drawn. In the event that only one financial
account was registered, that account is automatically selected by
the tokenless authorization system (step 714).
[0169] The PIA then transmits the information (e.g., account number
and expiration date, or track 1/track 2 information) associated
with the selected account to the payee's in-store payment system
(step 724). This in-store system, shown in FIG. 8, typically
consists of a point-of-sale terminal 902, an electronic cash
register 904, and associated back-office equipment, such as an
in-store processor 906. The in-store system then uses this
financial account information to authorize the financial
transaction just as if the payor had manually swiped a credit or
debit card through a card reader attached to the in-store system.
This authorization generally involves forwarding the financial
transaction information (transaction amount and account number)
(step 806) to a financial transaction processor for execution (step
808, FIG. 8). Examples of such processors included First Data, NPC,
and others.
[0170] Execution by the financial transaction processor may result
in a declined transaction due to lack of funds or other problem
condition reported by the credit/debit network. If the transaction
is declined, the in-store system notifies the payor, and the payor
may either cancel the transaction, or provide another account from
which to originate payment. A block diagram of the components that
comprise the system in a typical retail point-of-sale transaction
is shown in FIG. 8.
[0171] Network Point-of-Sale Transactions
[0172] Network point-of-sale transactions are characterized by
identifying the payor using the payor's bid biometric sample
submitted through the payor's personal PIA 101, or through a public
PIA attached to an ATM, point-of-sale terminal 902 and electronic
cash register 904, or other public terminal. The payee is a
registered network merchant, and is identified through a digital
certificate. Thus the payor is identified through biometrics, while
the payee is identified through the verification of a digital
certificate issued by an authorized certifying authority.
[0173] In a preferred embodiment, the payor first locates the payee
by locating the seller's place of business on the network: the web
site, using the network address of the payee. The payor downloads
the payee's digital certificate to the PIA that the payor is using.
The PIA verifies that the digital certificate provided by the payee
is a valid certificate.
[0174] The payor then submits a bid biometric sample obtained from
their physical person using the PIA's biometric sensor 102. The PIA
determines that the biometric scan is non-fraudulent, and then
translates and compresses that biometric scan into a format
suitable for rapid transmission to the DPC. Preferably, the payor
then enters a PIN code into the PIA keypad 106.
[0175] The PIA 101 transmits the biometric-PIN to the DPC 204 for
identification, along with the payee's digital certificate. The PIA
101 can transmit the biometric-PIN to the DPC 204 via store network
908. The DPC identifies the payor, and retrieves the list of
credit/debit accounts that the payor has previously registered with
the system, and transmits this list back to the PIA. The payor
optionally chooses from among a list of financial accounts, or the
payor may have only one financial account from which payment may be
made, in which case the payor's account is selected
automatically.
[0176] Once the account is selected, the PIA transmits the selected
account information to the DPC, which relays it to the payee. The
payee then forwards the information to a financial transaction
processor 426 for authorization or execution of the
transaction.
[0177] Execution by the financial transaction processor may result
in a declined transaction due to lack of funds in the account, a
closed account, or some other immediately detectable problem
condition. If the transaction is declined, the payee transmits the
decline notification back to the payor, and the payor may either
cancel the transaction, or select another account from which to
originate payment if another account exists.
[0178] Private Code
[0179] In one embodiment, a private code, which is distinct from a
personal identification number (PIN) and not used in a payor
identification step, and is preferably chosen by the user, is
transmitted to the PIA 101 from the DPC 204, and presented to
either the payor or payee subsequent to a successful identification
using biometrics. This private code identifies the authorization
system to the payor or payee users. The private code is selected by
the payor or payee during registration with the third party
identicator 204, and is never entered into the PIA during a
transaction authorization. Additionally, the PIA and DPC always
transmit the private code in an encrypted form. As a result, only
the authentic DPC and PIA can provide a person's private code after
a successful identification. The private code is displayed to the
payor to validate that the authentic electronic third party
identicator has processes the transaction.
[0180] Other Features
[0181] The transaction amount can include data that is necessary
for conducting a transaction such as price information, a list of
goods and services, a payee name, a date or time, a location, or an
invoice number, but can be just an amount.
[0182] The transaction acceptance step optionally further comprises
the payor entering a new transaction amount, which is the sum of a
cash back amount and the transaction amount, for the financial
transaction.
[0183] Preferably, in a payor re-registration step, the user's
registration biometric samples are compared against previously
designated biometric samples wherein, if a match occurs, the
computer system is alerted to the fact that the payor has
re-registered with the ETPI.
[0184] Also preferably, in a biometric theft resolution step, where
the payor uses a biometric-PIN identification subsystem, the
payor's personal identification number is changed whenever the
payor's biometric sample is determined to have been fraudulently
duplicated.
[0185] Optionally, during the payor registration step, the payor
registers at least one payor financial account identifier and
assigns an account index code to each payor financial account
identifier, and, after the payor has been identified, the user adds
the account index code to the financial transaction, wherein the
account index code further comprises one or more alphanumeric
characters.
[0186] In another embodiment, the payor can be a representative of
a business entity that has permission to access the business
entity's credit/debit accounts to purchase items on the
network.
[0187] From the foregoing, it will be appreciated how the
objectives and features of the invention are met. First, the
invention provides an electronic payment computer system that
eliminates the need for a payor to possess and present any
personalized man-made tokens, in order to authorize a
transaction.
[0188] Second, the invention provides an electronic payment
computer system that is capable of determining a payor's unique
personal identity, as opposed to verifying possession of
personalized objects and information.
[0189] Third, the invention verifies the payor's identity based
upon one or more unique characteristics physically personal to the
user.
[0190] Fourth, the invention provides a cost-effective electronic
payment system that is practical, convenient, and easy use, and
readily integrates tokenless payor identification using biometrics
with pre-existing credit/debit payment systems.
[0191] Fifth, the invention provides a system of secured access to
a computer system that is highly resistant to fraudulent
transaction authorization attempts by unauthorized users, and also
to interception of customer credit or debit card account numbers by
a dishonest store clerk or telephone sales operator.
[0192] Although the invention has been described with respect to a
particular tokenless authorization system and method for its use,
it will be appreciated that various modifications of the apparatus
and method are possible without departing from the invention, which
is defined by the claims set forth below.
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