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Are Risky Transactions Masquerading As Card-Present?
And if the thieves do break through, they can inflict far more damage. Indeed, today’s typical fraud detection techniques could be thrown off by such an attack, because that system is used to shutting down one violated card to halt fraud—not shutting down every associated card in someone’s mobile wallet, which is what would be needed.
This gets even trickier. Google Wallet uses the NFC Secure Element as a token vault, while Isis and most other NFC implementations use the Secure Element as a card-number vault. If thieves break through the vault walls, with most NFC implementations, they will have all the card numbers. With Google, though, those thieves will have only an account number that they might be able to use to get access to all the other card numbers if they can get through another layer of security.
The new Google approach has issues not because thieves might be able to break through those vault walls but because the Google “token” comes out of the vault. That’s when thieves might be able to grab it—as it’s passing through the POS system on its way to Google. And then the fact that it potentially delivers all the card numbers means the cyberthief gang could be detected on one card—which will be shut down momentarily—while the gang moves to the next card and then the next. Until card-brand fraud systems start to associate groups of cards within a single mobile wallet, where a breach in one card automatically shuts down all the associated cards, that hole will exist.
As
companies take advantage of the high-tech elements possible within mobile transactions, so, too, can the thieves. A statement issued on Wednesday (Oct. 31) by an Israeli mobile forensic vendor, for example, was intended to provide comfort but actually should make retail security folk quite nervous. The statement, from Cellebrite, said little new—it was really just announcing that the company is porting to a new platform. But Cellebrite did remind everyone that its software could deliver “full physical extraction of iOS 6 data” and “the extraction of all hidden and deleted data from devices running Samsung’s Jelly Bean OS, as well as the bypass of pattern, PIN or passcode locks on supported Android devices.”
In other words, all the sophisticated elements of mobile devices—the elements that have the potential for truly authenticating purchases, along with purchasers—can just as easily be turned into tools for thieves. And until this new functionality is truly mastered by retail IT, the thieves are likely to get there first.
This gets back to the PCI Council, the card brands and the retailers getting together to agree on the best mobile payment practices and procedures and to award those procedures lower interchange regardless of whether they are card-present. That would get into the argument of what’s really more secure, but at least that’s the right argument to have. And that’s a huge step up from the discussions happening today.
Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code.
-Marc
