Abstract: A consumer oriented secure smart card with various accounts which are accessible only through proper use of security measures. Security measures consist of encryption with described automatic key generation and management technique and a technique to authenticate the individual presenting the card.The encryption key generation and management technique involves having a secret constant or several secret constants programmed into the card and reader, having a secret mathematical function (algorithm) programmed into the card and reader and having both units generate a group of random characters or bits which are used locally and transmitted to the counterpart unit to generate a set of session encryption keys. The random bits and the constants undergo the algorithm in order to produce a unique transmit and receive key for each session.

Abstract: A method and apparatus for verifying the identity of an authorized remote user terminal for access to a base computer over a telephone line comprising providing the authorized user terminal with a programmed preselected algorithm, generating a random number at the base computer system to be accessed and transmitting the random number to the remote user terminal, performing the algorithm on the random number at the remote user terminal to calculate a first result, transmitting the first result from the remote user terminal to the base computer system, performing the algorithm on the random number at the base computer system to calculate a second result, comparing the first result and the second result and granting access to the base computer when the first result matches the second result.