GB2069201A - A portable "pocket" magnetic token and encoder - Google Patents

Abstract

The invention will provide for a private person a means to securely encode a magnetic token, thus rendering it useless to another person should the token be lost or stolen. Equally, the invention will allow a private person to decode a magnetic token previously encoded by that person. Because of the personally enacted security encoding, the invention will enable magnetic tokens to be used for a far wider range of purposes than at present.

Description

SPECIFICATION A portable "pocket" magnetic token encoder and decoder The technical field to which the invention relates The invention is a development and extension of existing technology concerned with the production of electronic pocket calculators and magnetic media token reading and writing techniques.

The background arts The background arts relevant to the invention are:1. Battery powered micro "pocket" calculators and processors.

2. Magnetic token, for example bank issued cash cards, reading either by wipe or fixed connection methods.

3. Magnetic token reading and activated dispensing and transaction originating equipment.

Disclosure The invention is a portable "pocket" electronic device (hereinafter referred to as 'device') that will in the ownership of a private individual enable that individual to encode the data content of a magnetic token, thereby making the magnetic token unusable by anyone other than its owner. The 'device' will also be capable of decoding data encoded by it, so long as the 'device' and the magnetic token are in the hands of the authorised owner who inserts the same personally determined identity code element into both the encoding and decoding process.

The 'device' has the capability to perform any or all of the five functions and operations on a magnetic token that are listed below. (For definition of a "magnetic token" see appendix A of this application for patent.) 1. Encode or decode the content of magnetic token.

2. To include in the encoding/decoding process a unique element being a personal identification reference consisting of numbers/letters/or symbols/or the translation of a personal characteristic of the owner of the 'device', for example voice-print or finger-print or signature.

3. To decode the information contained on the magnetic token in such a way and to common format so as to enable the magnetic token data to be read by general purpose readers other than the 'device' to which this patent applies.

4. To decode the information contained on the magnetic token and present on the 'device' a visual display of portions of selected information from the magnetic token to the owner of the 'device'.

5. To have the ability to add information to nominated portions of the magnetic token, and to perform addition, subtraction, division and multiplication on nominated areas.

In addition, the 'device' will 1. be electrically powered either by replaceable batteries or a rechargeable power source; 2. have a power-reducing indicator which will also prevent use just prior to the power being inadequate for the purpose required; 3. have a basic numeric keyboard with as necessary additional alpha keys, symbols and special function keys; 4. have a method of inputting to the 'device' the personal identification of the device owner; 5. have a connection apperture or connection point to enable the 'device' for which the patent is being applied, to connect with a token; 6. have a memory for use during intermediate data processing work.

The advantageous effects of the invention with reference to the background art A device such as that for which patent is applied does not already exist. There is nothing which is available to an individual which will convert a magnetic token into a secure encoded personal token unusable by anyone else, and then reconvert it to a standard format when the owner of the token and the device so wishes. The 'device' for which patent is applied will perform this function.

Magnetic token already exist capable of containing a high density of magnetically held data that will enable the 'device' for which patent is applied to be used for a variety of purposes, for which otherwise the magnetic tokens are not suitable.

Equipment already exists for reading magnetic token content when presented in a generalised format.

The invention for which patent is applied brings together various technological techniques including miniature key-operated electronic equipment production, microchip logic, magnetic token reading technology, electronic calculation, and magnetic store data processing techniques, in one device for a totally new purpose, namely the security encoding at the owner's discretion of a magnetic token, thus rendering it unusable by anyone other than its proper owner.

Drawings The drawing demonstrates in outline only the micro logic, general purpose and function keys envisaged.

Simple applications may eliminate the need for some logic areas.

Carrying out the intention Device size: approximate DISPLAY1 23 ON/OFF /1 7 8 9 CODE NUM A E I M O U Y 4 5 6 DE- DIS CODE PLAYS B F J N R V Z

1 2 3 CLEAR PLAYS P ' Personalised option C G K O S W

0 + - ALL- X . ( Spare PHA D H L P T X Key layout- General subject to ergonomic and systems Requirement change - Front On the reverse side of the 'device' is the magnetic token connection apperture.The technology of which can be varied to accommodate one of the following technologies: Magnetic memory connection by insertion Magnetic memory connection by laying on platter Magnetic memory connection by wipe technology.

Exploitation of the 'device' The applications of the 'device' are various. Examples, although not an exhaustive list, are:1. The 'device', by enabling credit card (magnetic tokens) to be encoded/decoded by the holder, will reduce fraud arising from stolen cards to a minimum, and could also give card holders a convenient electronic personal memorandum file of transactions and settlements.

2. The 'device', providing as it does magnetic token security, will make feasible cash cards (tokens) charged with value as an alternative to the whole or part payment of wages and salaries in cash, or to bank accounts, and which would in addition facilitate automated bill payment.

3. Make secure either credit or charged cash value cards for input to point-of-sale systems operated by retailers.

4. Make more secure by personalised encoding magnetic tokens which give access to premises or systems or are used to verify identity, and which if lost jeopardize a security system.

5. If industry standards for magnetic tokens are agreed the same device could be used on many different token types.

Systems use of the 'device'for which patent is applied The systems in which the 'device' for which patent is applied could be either an essential use or of beneficial use, are listed in the following five sections. These sections are examples only and do not represent a comprehensive list but demonstrate the scope of the 'device'.

SECTION 1.

Credit Card updatelencodeldecodelinterrogation Credit card systems have a number of problems, which are:1. Lost or stolen cards are used for fraudulent purchases, which cause great losses.

2. Card users receive voucher records of their card use.

3. Credit card companies find it difficult to justify point-of-saie systems which as a first stage eliminate paper as the transaction recording medium and, secondly, facilitate on-line credit referral.

The 'device' for which grant of patent is requested offers solutions to these problems when linked with a magnetic token having magnetic memory content. At the most basic level, i.e. problem 1 above, the magnetic card would be encoded by the card issuing company with a code (card holder name and number) acceptable to a simple cheap magnetic code reader/display unit in retail outlets, which could display the magnetic code for comparison with the embossed card description. The 'device' would enable the card holder, on receipt of a card, to encode the magnetic content in the manner and with the techniques described elsewhere in the request for grant of patent, thus making it unacceptable to a standard reading device until decoded by the card owner's device. The card holder would only decode the card when it was to be used and encoded it again after use.The elimination of fraud and misuse would be massive.

Used in conjunction with a magnetic token, the credit card companies could either immediately or in due course avoid or reduce the use of paper by enhancing the retailer's magnetic code reader/display unit to record on other magnetic media, such as a cassette, floppy disk or via telecommunications, for its own purposes the customer's transaction, and also record the transaction on the customer's token, which could, for example, be updated on a roll-over principle, by having a maximum store for transactions which, when full, discarded the oldest record inserting the new. The 'device' would be capable of reading the updated card to check that the transaction was correctly registered. This would be the most basic function of the 'device'.The 'device' could also be capable of addressing a memorandum section of the card store to calculate the effect on a memorandum balance of the transaction. The 'device' could also have the capability to enter a "credit" or "debit" memorandum item on the memorandum section of the card memory, and adjust the memorandum balance so that a current balance owing to the credit card company could be held as a memorandum. The 'device', when effecting an update of the memorandum section, would mark the original transaction as having been processed in this way, so that the transaction could not be addressed in this way again.

SECTION 2 Magnetic Tokens charged with value for non-bank account and bank account holders There are many corporate bodies who would derive benefit from substituting a value-carrying magnetic token for what are presently cash disbursements. At present no such magnetic token is sufficiently secure against illegal use if lost.

The 'device' for which patent is applied, which can encode, decode and interrogate a magnetic token, with the inclusion of a unique Personal Identification Number in the process, will totally overcome this difficulty.

The applicaton of the 'device' coupled with a value-charged magnetic token for the payment by employers of all or part of weekly pay or salary payments, is:1. The most basic application Each employee could receive pay in this manner. The employee having received the value-charged token and checked its content, using the 'device', will encode the token content until decoding is required at the time that a cash withdrawal is made. Cash withdrawal can be provided through a cash dispenser of a design which will read the decoded magnetic token, permit withdrawal of amounts up to the value on the magnetic card, and reduce the card value balance by the amount of the withdrawal.

An additional facility for the withdrawer of cash would be for the dispenser to record on the magnetic token the details of the transaction made, for subsequent reference by the cash withdrawer. The advantages of this application would be: (a) a more secure cash handling procedure for employers; (b) a potential cash flow benefit from retained balances for the employer; (c) very large savings in the administration of payroll; (d) convenience to employees, who can draw cash at any time in amounts they consider appropriate and secure rather than have the necessity of carrying large sums on their person; (e) the 'device' overcomes the weakest aspect of many present systems, which is the great difficulty of ensuring Personal Identification Number privacy when a public device must be used. For example, being overseen by another who subsequently acquired the token.

(f) the token holder can interrogate the token accounts in private, which could also eliminate the need for the retention of voucher transaction records.

2. Second level application If the employer so wished, and with the agreement of the banking industry or on the basis of bilateral agreement with interested parties, the cash dispenser device could be used to facilitate bill payment as an alternative to cash withdrawal. This could be simply accomplished by the cash dispensing device having the ability to accept a second token having recorded upon it the account and reference detail allocated to the payer by the payee. Payees could be anyone receiving periodic payments from the payer, for example, local authority rents, rates, water authorities, gas boards, electricity boards, the post office, mail order companies, hire purchase companies, building societies, credit card companies, retailers' budget schemes, insurers, retailers - i.e. even the newsagent who submits a periodic bill.The scope is very large and of benefit to employees, employers, the banking industry and all major suppliers of either goods or services.

In the case of the banking industry, a particular application exists which would be the transfer of money from the value token to a bank account.

Having described the scope of this application, it can be seen that whilst bilateral arrangements could be made initially, that involvement of existing bank clearing systems may well be the most economic way forward, especially in view of the benefit accruing to the banks from the reduction of cash and voucher handling which such services would produce.

SECTION 3.

Applications of the 'de vice' for bank magnetic tokens Magnetic tokens used as cheque guarantee cards, if including a magnetic memory, could benefit from the security of encoding which the 'device' offers against theft if retail points are equiped with a simple reading device to verify identification. Further, the cheque guarantee card could be specifically identified in magnetic memory as being such, and therefore having a continual balance on the card for point-of-sale applications referred to earlier, but rather than the automated transaction debit being addressed to an employer account, it would be addressed to the bank account holder's account.A further benefit of the magnetic memory token used in conjunction with the 'device' is that restrictions on frequency of use or total amount used in a day could be built into the token logic, which, if magnetic reading devices were in widespread use, would prevent excessive use of the guarantee token.

SECTION 4.

Input to point-of-sale systems operated by retailers Previous sections have dealt with the dispensing of cash, the payment of bills by electronic means remote from the offices of the payee. This section describes the point-of-sale application. The existence of a secure token charged with value made possible by the 'device' for which patent is applied, simplifies the development of point-of-sale terminal systems in the following way: (a) the magnetic token is a cash substitute and as such does not require "credit reference" or on-line systems.An automated transaction recorded on the retailer's reading device and debited to the purchaser's token and agreed by the token holder, needs no further value validation; (b) the security features of the 'device' remove the need for those security features such as customer's Personal Identification Number, input devices in the retailer's system handling value-charged tokens.

However, in this particular application there are procedural and security matters which must be satisfactorily resolved in order firstly to provide the service and secondly to insure the customer against fraud or fault in the retailer's system operation, which by its nature must produce a credit to the retailer's account and a corresponding debit to the token holder's reference file held by the employer.

The procedural matters are that inevitably the token-issuing employer must agree to the use of the token for point-of-sale applications by so endorsing the token both visually and magnetically to a common standard, because point-of-sale transactions originated by the token holder must be applied to an account funded by the employer on behalf of the employee, against which the retailer-originated debits are recorded.

Two approaches could be taken to this matter, which are: (i) point-of-sale originated debits supplied to the employer on magnetic media could be recorded on an - employee memorandum account in the dispensing device files, and then matched with the card at its next submission to the dispensing device of the token. If transactions match, then the employer transfers funds to the retailer. It should be remembered in this context that the employee has no benefit from deferring submission of the token, his previous purchase costs having been deducted from the balance of the card at the point of sale; (ii) the alternative would be for point-of-sale originated debits supplied to the employer on magnetic media, to be paid by the employer to the retailer at the time of receipt and recorded on an employee memorandum account in the dispensing device files awaiting matching with the employee token record at the time of its next submission to the dispensing device.

If this system were applied, which would be more predictable in cash flow terms, then employers would require a full indemnity against any loss occurring from a failure to match against the token holder's token, remembering that the original transaction (contract) was between the purchaser and the vendor, and dispute, should it occur, must remain between those two parties to the contract.

Employers may also wish to produce at an employee's request secondary tokens, to enable a wife, for example, to participate in a point-of-sale application of the 'device' and token card.

Should banks deem it beneficial to dispense cash and/or to facilitate bill payment to persons having value-charged cards, then they can do so on the same basis as a point-of-sale device, except that instead of goods, cash is being provided. In addition, should the banks wish to provide a bill-paying service, as described in the section "Magnetic Tokens charged with value for non-bank and bank account holders", they could do so under the principles defined for point-of-sale.

SECTION 5.

Security token encodingidecoding The 'device', when used in conjunction with a magnetic token having memory, would have an application for the encoding of magnetic security tokens to render them useless to anyone other than the designated owner if the token is lost or stolen. Such tokens would be used for: (a) door or barrier release; (b) personal identity proof; (c) access to automated systems, i.e. Prestel; (d) access to private or security files; (e) acess to personal secure containers having magnetic locks.

Claims (1)

1. The technical features of the invention are: (a) use of micro-clip technology to provide the logic elements of the invention; (b) the invention is electrically powered from a battery source which may be recharged either by battery replacement or a suitable rechargeable battery; (c) a connection point for a magnetic token which may be based on apperture, platter or wipe through techniques; (d) the ability to encode or decode the data content read from a magnetic token, and write the resulting standard format data back to the magnetic token; (e) a provision in the logic of the invention to enable the owner to insert a personal identification code as an integral part of the data encoding and decoding logic. Such code may comprise numeric, or alpha, or alpha numeric characters.It is envisaged that technology may permit a development in due course to replace the personal code content with electronic interpreation of personal characteristics, such as signature, voice-print or finger-print; (f) logic to protect the invention user against inadequate elec.trical power to complete the operation required of it; (g) a key board containing keys, examples of which are: (i) numeric keys 0 - 9 (zero to nine); (ii) special function keys for OFF/ON (power) ENCODE, DECODE, DISPLAY PRIMARY MEMORY, INTERROGATE PRIMARY MEMORY, ADD, SUBSTRACT, MULTIPLY, DIVIDE, plus optional features ALPHA KEYBOARD, DISPLAY and INTERROGATE MEMORANDUM MEMORY, UPDATE MEMORANDUM MEMORY.

   characterised by the combination of the foregoing features (a) - (g) into a single electronic device which is of a size conveniently portable by a private person and operable by a private person, which provides secure and personalised encoding of magnetic tokens when the token is not in use and conversely to decode the magnetic token back into its original format when the token is required for use in general purpose magnetic token reading devices.

   APPENDIX A.

   Magnetic Token : Definition A magnetic token, hereinafter referred to as "token", can be of any size but is likely to be sufficiently small for convenient personal handling, but is likely to be large enough to be easily recognisable by the owner. The "token" will be required by the 'device' for which patent is applied to contain addressable memory. Magnetic memory would be appropriate, but so could be other technologies yet to be commercially viable. The "token" memory must be: (a) readable; (b) updatable, i.e. capable of being written to; (c) be connectible to and in some cases addressable by general purpose token reading devices that could be used for applications such as: (i) credit cards (ii) cash cards (iii) cash cards charged with value (iv) point-of-sale (v) security cards.