Visa Tests New Anti-Fraud Card Device, But What About The Data Leaks?

from the finger-in-the-dike dept

Visa is testing a new type of credit card that's got additional security measures built in as a means of cutting down on "card not present" (CNP) fraud -- the fraudulent sales rung up using stolen credit-card numbers and the security codes that are normally printed on the cards. Visa's new cards have a small screen on the back that displays a six-digit code when the cardholder enters a PIN on the card's keypad, making it sound like Visa has basically built in a tiny version of something akin to the SecurID, a popular two-factor authentication device for corporate computer networks. The devices generate an additional one-time password using an algorithm synced with the system on the other end; the user enters this password when they attempt to log on, or in Visa's case, make a CNP transaction. If the passwords match, the transaction goes ahead. It sounds like a good way to cut down on CNP fraud, but is it just a way to try and gloss over the massive data leaks that see millions of credit-card numbers lost out into the world? It almost seems that if these new anti-fraud cards make it to market, the party line will be "the data leaks don't matter anymore" -- but criminals will still be able to obtain credit-card numbers and make fake cards with the stolen info (for card-present fraud). It might make criminals' lives a little more difficult, but it won't make credit-card fraud impossible. Raising the level of security on credit cards is, without question, a good thing. But unless it involves doing more to stop massive data leaks, it's not enough.
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Filed Under: anti-fraud, credit cards, fraud
Companies: visa


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  1. identicon
    Dolphineus, 15 May 2009 @ 6:11am

    Every processor that accepts Visa will have to change their system to accommodate this. If I am shopping at an online store who uses a credit card processor who has not updated, will I still be able to use this card?

    How durable is the card? How easy is it to kill the pin pad or LCD window? How does it hold up to the abuse cards take in the real world? Heat? Cold? Bending? Magnetic or electronic interference?

    Who eats the cost of replacing these things?

    I'm not aware of any SecurID type system being hacked, but there has never been this much MONEY available for hacking them. How long will it be until this too is compromised (most likely by some website/online processor being hacked)?

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