Bebe, a popular women’s apparel retailer with 175 retail and outlet stores in the US, Canada, Puerto Rico and the Virgin Islands, is the latest victim in a string of cyber-attacks to hit commercial businesses around the world. Bebe thus far is staying silent on the exact number of credit cards exposed from its database, but they believe that the stolen information includes name of cardholder, credit card number, verification code and the card’s expiration date. Corporate officials say that the breach involves only cards that were used for in-store purchases at their Puerto Rico, US and Virgin Island locations. Bebe engaged a cyber-security company immediately upon discovering the breach, preventing any further damage.
Technology has advanced the world, including the underworld—organized crime bosses, criminals and terrorists are making use of the newest cybercrime technologies to steal credit card information, produce illegitimate airline tickets and passports and otherwise engage in domestic and international criminal activities. For airlines who end up bearing the costs of illegally purchased airline tickets and governments hot to their secure borders, busting these cybercrime activities is of utmost importance.
Thanks to big data, law enforcement officials now have an enhanced tool. A case in point is a recent string of 118 people allegedly involved either in fraudulent credit card use or manufacture of phony airline tickets. Law enforcement officials from 45 countries, 80 airports, 60 airlines, and the major credit card companies participated in the arrest, which was coordinated by the European Cybercrime Center. Storing and analyzing big data collected by airlines, ticket outlets and credit card companies enables law enforcement agencies to spot and track suspicious transactions leading to timely arrests.
Healthcare providers, insurers and pharmaceutical members of the National Health Information Sharing and Analysis Center (NH-ISAC) are looking forward to an enhanced cyber intelligence sharing platform. Deborah Kobza, NH-ISAC Executive Director, says that the new platform will provide its 150 members with better and timelier insight into emerging security breaches, whether they be malware, spear phishing or social engineering. Kozba says that they expect cyber-attacks to become more creative and more focused on information extraction, so institutions must have immediate access to useful cyber alert intelligence. The NH-ISAC platform, which is built on technology from Soltra Solutions and Vorstack will enable direct sharing of threat information among members, without needing to involve a third-party distributor.
Well, not exactly, but the banking industry is a bit nervous about potential future encroachment on their customer base by internet giants such as Google, Apple and Facebook. In fact, according to a survey by Infosys, 45% of the banking industry is worried about losing market share to the cyber technology companies.
The growth of internet transactions
The world is radically different today from the time when all financial transactions took place at the neighborhood bank. Now that the priority of consumers across the globe is doing just about everything online and one-stop shopping from the comfort of home or on the move—internet companies are benefitting massively.
Google, Facebook, Apple and other major players in cyberspace have successfully filled the niche created by the changing dynamics of consumerism, and their expansion into financial services is what is now catching the eye of banking industry executives. Google, for instance, has made significant investments in financial services since starting Google Checkout. In Ireland, Facebook has become an e-money institution, allowing its users to store money and make payments, all through the Facebook interface. And Apple Pay is a mobile payment service available on Apple devices, with which customers can checkout in person (instore) or online. Apple recently announced hundreds of partnerships with all the major players in the retail industry and credit card companies. Apple Pay replaces the normal swiping of a credit card on a digital system, eliminating the need to keep cash or credit cards in the pocket.
Banks are here to stay
The truth is, though, that internet companies are not interested in competing with the banks. The traditional role that banks play is of no interest to companies such as Google or Facebook. They are much more dynamic and cutting edge, focusing their efforts on growing user base, generating advertising revenue and enhancing their outreach to the internet world. So banks need not fear that a Google Bank is going to open across the street. At least not for now.
With all the stories in the news lately about cyber-attackers hacking online merchants and stealing credit card payment details, it is no wonder that credit card fraud is the issue causing consumers the most worry. It has also recently been reported in the press that credit cards are being physically compromised by extremely clever criminals, who either switch cards during the charging process (replacing the card handed to them with an expired one) or take a quick photo of the credit card with their smartphones. All of this has resulted in a wave of consumer anxiety. In the annual Gallup Crime Poll, it was revealed that as many as two-thirds of those polled expressed fear over having their credit card accounts compromised.
Is credit card theft worse than a home burglary?
In spite of the heightened level of fear around payment fraud, a home burglary is actually much more serious than credit card theft. Assuming it is an actual credit card and not a debit card, any unauthorized charges can be recovered. If the consumer doesn't realize the card has been compromised until they receive the statement from the credit card company, that is also not a problem—they simply refuse to pay the bill and enter a payment dispute process. Individuals are well protected against credit card fraud these days, pursuant to the Fair Credit Billing Act and other federal legislation designed to minimize risk and improve consumer rights. In essence, then, being mugged on the street or experiencing a home burglary is much more serious and likely to lead to permanent loss of property.
How to ease the anxiety
Nevertheless, as we see from the Gallup poll, consumers are worried. With a few simple security measures, such anxiety can be reduced and consumers can concentrate on shopping for the holidays. Simply always make sure you
• Keep your credit cards in a safe place
• Encrypt all data on devices you use to access the internet, and use strong passwords and other access codes
• Set up verification measures such as SMS, email or phone calls when your credit card is being charged
• Review your credit card statement and immediately contact the bank or charging company if you see unauthorized expenditures.