Most RFID chips remain easy to break by hackers specially in places like supermarkets. One reason: the cheapest and most popular RFID chips don't have a battery; instead, they're powered by the reader when scanned. That limits the amount of encryption that can be placed on a chip.

Here is a nightmare described by a Business Week author:

A hacker goes into a store, buys a can of soup with an electronic tracking tag glued to the side, and takes it home. There, he attaches a different tag, this one with malicious code. He goes back to the store and lets the item get scanned anew at the cash register. This time, the code jumps from the tag onto the store's computer system, changes product prices and skews sales data, and creates an entrée for an outsider to gain access to the store's internal databases.

So what to do?

To be sure, new chips used for potentially high-value financial transactions have more safeguards. They can be adjusted so that they can be read only from a very short distance of a few inches, for example. That would prevent hackers from reading cards as shoppers pass through a nearby checkout line. They also contain more encryption. (They're also more expensive, at $4 or more per tag, compared with about 20 cents for your average RFID tag.)

So the question still remains: what to do? There is no way to spend 4$ per tag for companies like Wal Mart. One possible answer is to categorize tag applications throughout the company and use high performance tags for the most risky areas. This solution is a bit more economical, at least.