[ISN] Michaels Breach: Patterns Showed Fraud

From: InfoSec News <alerts_at_private>
Date: Mon, 16 May 2011 00:20:27 -0500 (CDT)

By Tracy Kitten
Managing Editor
Bank Info Security
May 13, 2011 

Card issuers were quick to link incidents of debit and credit fraud to 
the Michaels retail chain, experts say - a sign that strong transaction 
monitoring and behavioral analytics are the best ways to curb growing 
card-fraud schemes.

The Michaels card breach is now believed to have affected stores in 20 
states. The mode of card fraud: Point-of-sale PIN pad tampering, also 
known as PIN pad swapping. [See 3 Tips to Foil POS Attacks.]

Brian Riley, senior research director of bank cards at TowerGroup, says 
as details about the breach are gradually revealed, it's clear that 
financial institutions, as card-issuers, picked up on the common fraud 
link - Michaels. "The behavioral scoring in this was really high," he 
says. "The pattern of transactions showed that all of these affected 
accounts had Michaels' purchases in their history. Behavioral scoring is 
really where it's at in card transactions."

Even advanced card technology, such as the Europay, MasterCard, Visa 
chip and PIN standard, which takes the skimmable magnetic-stripe out of 
the equation, would not have helped in the Michaels' case, Riley notes. 
"With a tampered POS device, you can get around EMV," he says. "A good, 
robust scoring system is the only way to really pick up on this. That's 
why behavioral scoring is so important. That's, quite often, how these 
things are discovered."


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Received on Sun May 15 2011 - 22:20:27 PDT

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