Once again we have been reminded of the vulnerability of financial institutions to credit card fraud. Last week we saw the news that a large gang of thieves (a number of whom have just been
arrested in New York) managed to steal an enormous $45 million from thousands of ATMs in just a matter of hours.
This latest crime may have been complex in its deployment – the sheer scale of it was staggering – but at its heart was the “traditional” technique that I have spoken of before: obtaining customers’ credit card details and later using the data to manufacture
false credit cards.
Questions must be asked of a system that allowed $40 million to be withdrawn from 36,000 cross-border transactions in just 10 hours. Sadly, it may not be an isolated case. This crime highlights the fact that cross-border fraud, committed at ATMs and Point-of-Sale
(POS) devices, remains a major problem for card-issuers the world over.
Many current bank systems are either missing fraudulent transactions (as we’ve seen here) or, conversely, are dogged by false positives (declining legitimate transactions) in order to stop fraudulent transactions, which can result in inconvenienced customers
and higher costs. But there is technology already being used that mitigates both issues, essentially by ‘tying’ individuals’ credit cards to their mobile phone and using proximity correlation analysis.
If the accounts affected by this crime had this technology incorporated, the thieves would not have been able to withdraw money from their various ATMs because the system would have picked up that the account holder’s mobile phone wasn’t in the same proximity
as the fake card.
This latest crime underlines once more the need for efficient, real-time detection, prevention and resolution, protecting the customer and the banking organization from both fraudulent transactions and false positives.