continued from page 7
type of fraud is directly linked
to the card issuers—American
Express®, Discover®,
MasterCard® and Visa®. As
early as 2008, these companies
were telling U.S. financial
institutions that the “chip and
pin” system, which activates
immediate encryption of
transactions and was already
in place in Western Europe,
would be available in the
United States in two years.
Those same companies were
giving that same two-year
to Europe or beyond must
contact their card issue for a
“pin” enhancement that will
allow use of their card in other
countries. It could be said that
the card issuers’ delay is
profit driven.
Debit and credit card holders
must assume responsibility
for monitoring their account
activity, as well as bank
accounts, especially if engaged
in online automatic payments.
They must also know the
transfer procedure have been
found in the systems of
financial institutions. These
“bugs” enable the cyber thieves
to duplicate the transfer of
funds out of the country to
their site. As a result of this
new development, wire transfer
requests and transactions
need to be even more closely
monitored than before. Taking
extra time to confirm wire
transfer requests, as well as
questioning any “out of the
ordinary” amounts or receivers,
can prevent considerable losses
and strengthen the business/
customer relationship.
A good resource to keep
abreast of cyber-fraud is
Krebs on Security
(krebsonsecurity.livejournal.com).
Many regard it as the fastest
and most reliable resource
regarding the latest activities
challenging businesses and
individuals in cyberspace.
deadline in 2013.
After mid-year 2013,
replacement cards with chips
began to be issued in the
United States but the transition
to full utilization of pins was
not in place. The card issuers
have blamed the financial
institutions and retailers for the
delay, claiming that they were
unwilling to pay the additional
cost of upgrading the card
scanners and the production of
the enhance cards. As of this
date, “chip and pin” has yet to
be fully activated in the United
States. Any American traveling
difference in how disputes of
invalid debit card and credit
card activity are handled and
which party incurs losses.
By now, most financial
institutions have put
procedures in place regarding
wire transfers, to protect
customers against scam
losses. However, the
perpetrators continue to
develop ways to penetrate the
best-designed procedures.
Recently, previously implanted
“bugs” that replicate the wire
In an effort to more efficiently
pursue financial crime
perpetrators, the FBI recently
established a toll free reporting
hotline, where analysts collect
information from callers and
cross check their system for
similar reports to enhance
investigations and the
likelihood of successful
prosecution. That number is
855-835-5324.
In addition, consumers can file
a complaint with the Federal
Trade Commission Bureau of
Consumer Protection and/or
contact the Consumer Fraud
Protection Bureau, the National
Insurance Crime Bureau and
the FBI.
Continued on page 9
The Credit Professional
8
October 2015