Chip-And-PIN Breach: Bluetooth, Burned Hole In Back Of Card Reader

Written by Frank Hayes
June 24th, 2010

For those who are arguing that Chip-and-PIN represents the gold standard in card security, there was a cold splash of reality this week. Four fraudsters from London were sentenced to jail for their parts in a nine-month string of thefts that netted almost $1.1 million by tampering with Chip-and-PIN card readers at gas stations. According to a BBC report, the group burned a small hole in the back of each reader and then inserted a memory device and BlueTooth reader that allowed it to capture information and then clone customers’ cards.

One gas station owner saw business drop by 47 percent once customers realized money was being taken from their accounts after visiting the station. The gang’s 29-year-old leader, software engineer Theogenes De Montford, was arrested with information from 35,000 cards on his laptop–7,000 of them from a single gas station.


One Comment | Read Chip-And-PIN Breach: Bluetooth, Burned Hole In Back Of Card Reader

  1. A Reader Says:

    To be fair, Chip and PIN was not breached. The mag stripe was cloned.

    The only reason their cards have mag stripes is so they can be used in third-world countries that don’t have chip and PIN terminals, such as the United States.


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Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) 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. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

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