Security breach creates credit card fraud risk

[Tami]

Security breach creates credit card fraud risk
CTV.ca News Staff

Hundreds of thousands of Canadian credit cardholders could be at risk from fraud following an unprecedented security breach at an American data processing company.

On Friday, MasterCard International Inc. said up to 40 million cardholders of multiple brands across North America could be vulnerable to fraud due to a security breach that began in 2004.

Visa Canada says the breach exposed as many as 240,000 Canadian accounts.

Mai Velasquez, a spokeswoman for Visa Canada, told CTV that the fraud hasn't shown up yet.

"There could be some fraud. We don't know what the perpetrators have done with the information. So at this point, we can't confirm anything," she said.

MasterCard Canada didn't have a precise figure, but 90 per cent of the 13.9 million accounts at risk belong to U.S.-based cardholders.

Canadian accounts are part of the remaining 10 per cent worldwide, spokesperson Jennifer Reed told CTV.ca.

Casey MacLean, a fraud investigator for American Express, told CTV that once a criminal has a valid credit card, they can go on a major spree.

"Lots and lots and lots," she said with a laugh. "I'm not going get into it, not going to give anyone hints, but there is lots of money at stake."

MasterCard International announced Friday that its security division detected multiple instances of fraud. It tracked those cases back to CardSystems Solutions Inc. -- a Tucson, Ariz.-based company that processes credit card payments for banks and merchants.

The breach exposed data such as names, credit card numbers, expiration dates and security codes on the back of cards, but not addresses or Social Security numbers.

A virus-like computer script that captured customer data for the purpose of fraud hit CardSystems, according to MasterCard spokesperson Sharon Gamsin.

The FBI is investigating how the script got into the system.

Zero liability

Credit card companies are reminding customers that they do have programs in place to protect against fraud.

In a global statement, MasterCard indicates its zero-dollar liability limit policy protects U.S. cardholders from losses related to unauthorized purchases.

And Reed tells CTV.ca "the zero liability protection is offered to Canadian cardholders as well."

"If you suspect there is an unauthorized purchase," says Reed, "contact your card issuer. There's a 1-800 number on the back of your card."

Visa says the company's Zero Liability program protects all its cardholders in Canada.

"Monitor your account for any unusual activity. Contact your financial institution if there is anything unusual on your visa bill. Your financial
institution will also monitor your bill for unusual activity," Velasquez said.


In a statement, Visa Canada says it's working with CardSystems, police and the affected banks to monitor and prevent card-related fraud.

"We regret any anxiety that this may cause our Canadian cardholders and as always, we encourage cardholders to continually monitor their accounts and to immediately notify their issuing financial institution of any unusual activity."

Citigroup says in a statement that it's taking action "above and beyond our normal actions" to detect and prevent fraud.

Late Friday, CardSystems said in a statement that it first learned of a potential breach on May 22. The FBI told it not to release any information to the public.

The company has been in business for more than 15 years, and claims it processes transactions worth more than $15 billion US a year.
[i]
With a report from CTV News Toronto's Austin Delaney[/i]

source: [url=\"http://www.ctv.ca\"]CTV News[/url]