Verifone: Steal This Card Data

Written by Frank Hayes and Evan Schuman
March 9th, 2011

In an ironic move, payment security vendor VeriFone on Wednesday (March 9) posted a video showing how to turn a mobile payment device into an illegal skimming unit. Not only did it post a video depicting this technique, VeriFone also posted a skimming application it wrote and encouraged consumers to download it.

VeriFone did this all to attack a much smaller rival called Square, which it repeatedly identified by name. The ironies continue. VeriFone posted a special page for this content, including a domain name referencing its rival, Square: A key part of that page was a YouTube icon that would play the video. But YouTube quickly took down the video, breaking the link.

The video itself encouraged people to grab a copy of VeriFone’s application, which is designed to turn Square’s dongle into an unencrypted skimming device. VeriFone CEO Douglas Bergeron narrates the video and says the site is “where you can download the sample skimming application and see for yourself.” And yet, no such link exists on the page. The link was removed, just as the YouTube video was.

Late on Wednesday, VeriFone spokesman Peter Bartolik confirmed that the file had been removed. “The app has been taken down and won’t be restored.” Oddly, the reference on the page that the app can still be downloaded remains, albeit with no link, as of 9:30 AM Thursday (March 10).

Bartolik offered an explanation for the app’s removal: “It became evident that some observers were coming to the conclusion that VeriFone had made available an actual skimming app, which was not the case. The app we made publicly available was a demonstration app that showed an ability to read data from a Square device, but did not actually display or capture sensitive card data. However, in order to curtail further confusion, we have removed the demo app. The video is self explanatory.”

The only concern here is the point that “some observers were coming to the conclusion that VeriFone had made available an actual skimming app.” From their statement, it’s easy to see where that impression came from.

The statement, on VeriFone’s Web page, attributed to Bergeron, said: “In less than an hour, any reasonably skilled programmer can write an application that will ‘skim’—or steal—a consumer’s financial and personal information right off the card utilizing an easily obtained Square card reader. How do we know? We did it. Tested on sample Square card readers with our own personal credit cards, we wrote an application in less than an hour that did exactly this.”

That’s pretty clearly stating that the application being referenced was skimming numbers. Bergeron’s statement later says, “See for yourself by downloading the sample skimming application.” Also, how could an application show “an ability to read data from a Square device” without actually doing it? The video showed the app doing its work—which is a demonstration of the app—but by also offering to download the actual “sample skimming application,” it’s hard to envision any other reasonable interpretation.


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