Heartland Breach Still Generating New Compromised Accounts

Written by Frank Hayes
April 6th, 2011

Old breaches never die, they just—well, they never die. A small bank in Illinois on April 1 announced that some customers’ payment card information had been compromised at card processor Heartland Payment Systems. Yes, that Heartland. And yes, that breach—the one in 2008. “MasterCard and Visa, along with the FBI and Secret Service, have been investigating the incident for several years, and although the security breach is reported to have occurred between May 2008 and November 2008, the compromised information is only now being used to conduct fraudulent transactions,” Freestar Bank President Scott Bauknecht told a local newspaper.

That means that, more than two years after the breach was closed and the first arrests were made in the Heartland case, the thieves are still working their way through the trove of stolen card numbers. Holding onto the numbers that long is a gamble for the thieves, of course, because many of the cards could expire or be canceled over that much time. Then again, after two years without any fraudulent activity, banks and retailers will almost always assume that a card number hasn’t been stolen. That assumption may not be safe again for a long time.


One Comment | Read Heartland Breach Still Generating New Compromised Accounts

  1. Shekar Swamy Says:

    Clearly,a well-orchestrated breach is designed to maximize the value of the card numbers that were stolen. Indeed, years after they were stolen, the effect is still being felt. Retailers in the convenience store, petroleum and quick-serve restaurant markets are often in denial about what it means to be secure.

    Filling out an SAQ is not the answer to data security. There is a misconception that if a retailer qualifies for filling out SAQ C, then they don’t have to worry about any other requirement. On the contrary, they still need to follow all aspects of PCI DSS to whatever extent possible. This is the only way to minimize the risk of breach. Once breached, the damage maybe felt for years to come. I really do hope that smaller retail chains wake up and do something about data security. Senior management of these companies need to start protecting their business interests rather than assuming the risk of a data breach.


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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...
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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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