BBC story on hacked Visa & Mastercards

[David Farber <farber () tmail com>]

-----Original Message-----
From: Richard Jay Solomon <rsolomon () dsl cis upenn edu>
To: David Farber <farber () cis upenn edu>
Subject: BBC story on hacked Visa & Mastercards
Date: Tue, 18 Feb 2003 11:26:32 -0500

http://news.bbc.co.uk/2/hi/business/2774477.stm

> Tuesday, 18 February, 2003, 16:17 GMT
> Hacker breaches credit card security
>
> The companies said none of the information was used in a fraudulent 
> way
>
> A computer hacker has gained access to more than 5 million Visa and 
> Mastercard credit card accounts in the US.
>
> The two companies said on Tuesday that none of the information 
> obtained, which would include credit card numbers, was used in a 
> fraudulent way.
>
>  The only way to eradicate the risks would be to reissue all 5 
> million... cards
>
> Peter Lilley, business crime expert
>
>
> But a UK-based business crime expert warned account holders could still 
> be at risk if their cards were not reissued.
>
> Visa and Mastercard said the hacker breached the security system of a 
> company that processes credit card transactions on behalf of 
> merchants.
>
> Numbers of credit cards can be used to make payments, such as buying 
> plane tickets or hiring cars.
>
> Both Visa and Mastercard operate zero liability policies, which protect 
> card holders from having to pay for any unauthorised or fraudulent 
> charges.
>
> Card holders at risk?
>
> Peter Lilley, a fellow of the UK Chartered Institute of Banking and 
> author of various books on hacking and business crime, said some 
> hackers attack computer systems just to prove the point that the system 
> is insecure.
>
> But he told BBC News Online that account holders of the hacked credit 
> cards could still be at risk.
>
> "To gain access to 5 million different accounts is a lot.
>
>  Although fraud is at an all time low, high profile companies ... will 
> always be targeted by criminals -Visa and our vendors are no exception
>
> Visa statement
>
>
>
> "The bottom line is, when somebody has access to 5 million numbers, it 
> puts those accounts at risk in the future.
>
> "Strictly speaking, the only way to eradicate the risks would be to 
> reissue all 5 million account holders with new cards."
>
> But he also admitted that scenario posed all sorts of logistical 
> problems.
>
> The Visa and Mastercard credit cards are issued by numerous financial 
> institutions.
>
> "And each institution could end up taking a different approach," Mr 
> Lilley said.
>
> Banks warned
>
> A spokeswoman for Visa in the UK could not comment on any plans to 
> reissue the compromised cards in the US.
>
> But a UK spokesman for Mastercard said that decision was up to the card 
> issuers.
>
> "Although fraud is at an all time low, high profile companies, 
> government agencies, internet programs and websites will always be 
> targeted by criminals - Visa and our vendors are no exception.
>
> "It is for this purpose that Visa has global fraud prevention, 
> detection and avoidance programs and is extending secure payments in 
> the virtual marketplace," Visa said in a statement.
>
> Immediate alert
>
> More than 560 million Visa and Mastercard cards circulate in the US.
>
> Mastercard said it informed its members two weeks ago that more than 2 
> million accounts had been hacked into.
>
> Visa said about 3.4 million of its accounts were accessed by the 
> computer hacker.
>
> Both companies said they immediately alerted the affected banks that 
> issued the cards.
>
> "Visa's fraud team immediately notified all affected card issuing 
> financial institutions, and is working with the third-party payment 
> card processor to protect against the threat of a future intrusion," 
> the company said in a statement.
>
> The firms are also working with US law enforcement officials.
-- Dave

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