NEWS Although it's hoped the introduction of chip and PIN credit and bank cards will cut fraud and associated crime, the scammers are making a few bob while they can from the raft of new plastic being sent out.
Financial institutions need to have all their customers using chip and PIN cards by 1 January 2005 which means a flurry of new cards are being posted out across the country to replace the old chip-less variety.
The criminals have caught on and are intercepting the cards before they get to their rightful owners and then spending the cash, with the unlucky victims - often unaware a new card is on its way - only finding out when they get their statement and see an empty bank account, according to The Guardian.
London police stations are receiving three or four similar complaints a day, the paper said.
Around 130 million cards need to be replaced but three out of five people in the UK now have chip and PIN cards. While some retailers including Asda have already rolled out terminals with the technology, others, including Sainsbury's, don’t expect to be able to meet the 2005 deadline.
Comments
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1. Ian Livermore
Chip and Spin ! The banking institutions once again are opening the flood gates for fraud. When asked hows is chip and pin more secure thay replied "it works in europe, so it must work here" IDIOT'S. For more security we should have Chip, Pin and Sign.
Just another security flaw when a Credit Card terminal requested a referal the other day we were asked by the Bank to ask our customers private security number in front of customers. Secure or WHAT !
2. Paul
"The criminals have caught on and are intercepting the cards before they get to their rightful owners and then spending the cash" - How is this happening? I've received a couple of cards in the past month and I have to go through a lengthy process of verification over the phone with the vendor before I can use my plastic. In any case, how do they know what the PIN is?
3. David H Minnis
From the pin pads that I have seen there does not sem to be much in the way of security. A blind man at thirty paces could see what numbers are being tapped in. These keypads should be better shielded. Card issuers take note
4. anonymous
Well now, what a non-surprise & where do these criminals work or have contacts? An ex-postman told me years ago how they intercept cards at the sorting office, then wait for the letter with the new pin. If one does not appear, they still have the new unsigned card. It's been going on for years. The only items that I have had go missing in the post were from financial institutions, or postcards.
Some of which were found lying in the road, where they had been thrown by a cadet postman.
5. Karen Challinor
Well yes, thieves love keypads because it's much harder to forge a signature.
6. anonymous
Why do you keep repeating this nonsense that Chip and Pin is intended to reduce fraud?
Chip and Pin will not reduce fraud but it will allow the banks to wriggle out of liability.
If someone forges your signature you have some chance of proving that's what happened. If one of the dozens of people in any of the queues you'll be forced to type your pin in front of every time you buy anything subsequently steals your card it will be your fault as you must have 'revealed' the pin.
7. Dr John Dimmock
Are we really a bunch of Muppets? The only reason Chip and Pin has been introduced is to enable the banks to change the terms and conditions, with chip and Pin we become responsible for any fraud. This article actually highlights the ease in which Chip and Pin can be hacked – what’s wrong with biometrics?
8. James Button
Chip & Pin, why not Photo and Thumb
Went to my local Library - 30 seconds to get a photo card that's also a London Transport Oyster card - no charge, and they took the photo.
At least with a photocard a salesperson has something to check, and the card company could get a copy of the photo to check every time the card was used -
Want to use my card, then it's a full facial disguise, not just link the pin reader to a laptop or PDA under the counter.
9. Cryptus
I agree that the chip and pin system opens up a whole new can of worms and many new possibilities for financial crime but it also presents us with more secure transactions.
A chip cannot be cloned for instance. A large majority of plastic crime is done at the till when the cashier secretly scans the magnetic strip with a reader (under the till, out of sight or something) which then enables them to clone the card.
Also, effective use of a stolen card is reduced as well. It'll take the average person a matter of minutes to forge the signature on the back of your conventional card, and that's for an average unpracticed person. Criminals spend days and weeks practicing these things, they'll be able to forge it in seconds.
On the other hand there are 10'000 unique possible combinations using the 10 numbers from 0 - 9 and 4 independent positions.
And most cards these days are blocked after 3 or 4 unsuccessful attempts as well.
You can't train yourself to guess 4 random numbers like you can train your eye to read a signature strip...you do the math.
Yes, the keypads need to be more secure...but how many times a week do you stand at the cash machine on the high street, keying in your PIN to draw cash? And then walk away with the cash in your hand showing everyone around just how much cash you have.
Come on people, think about it! There will never be a time when the world is free of crime. It'll always be there and it'll always hurt both you, me and every other good person out there but to just play down and pick at every new initiative trying to keep crime in check, well that's foolishnes. Naive, ignorant, stubborn foolishnes and there's no excuse for that...and there's no denying it either.
So instead of signing a bit of paper and throwing the carbon-copied customer copy with your signature in the nearest bin, just look around that nobody's too close, stand a little closer to the keypad, cover it with your other hand if you have to, and quickly key in your 4 digits.
10. Peter Lewis
What a bunch of Luddites!
The over-riding consideration is that Chip & Pin has been *proved* to reduce losses through fraud. I'm very happy to be able to use my French Carte Bleue (with 14 years of Chip & Pin) just about everywhere in France, as the CB commission is relatively low, helped by lower losses through fraud.
One of the important considerations is that a significant cause of fraud is collusion between shop assistant and 'customer'. It's easy for the assistant to say that the signature looked OK to them. With a PIN, it's a very different matter - you either know the PIN or you don't.
As for practical issues, which would you rather lose - a card with a visible signature or one with an invisible PIN?
11. Matthew
Some European countries Social Benefit agencies are using a photo & embedded thumb id. You can't get a better match than a perfect thumb print.
This is not about protecting the individual - it is only about reducing card issuer liability.
Another example of self interest.
The only way to stop this is to pay for everything in cash and put them out of business overnight.
12. anonymous
Different banks have different verification methods. Some of them don't require you to give secure passwords to activate cards then others don't require you to have a new pin number when you get a new card.
However the one stupid thing that lots of them do is send stuff out using first class post then act surprised if a few (thousand) cards get nicked and the corresponding pin number goes missing the next week. Considering this happened to me over 16 years ago and crime like this has got worse over the time, I am surprised that banks still don't understand that sending stuff out by 1st class post is not secure.
13. Greta Smalley
How are the thieves getting the PIN? It must be relatively easy to identify an envelope containing a card, but that alone doesn't give thieves access to an account - does it?
14. anonymous
easy, once they have the card, they simply wait for the pin to arrive the next day or a day after...
15. anonymous
None of the previous comments explain how a thief can use a stolen card at an ATM without the relevant PIN number, particularly when the card had earlier been disabled and not unlocked. Don't say impossible, it has happened!!!
16. John H.
It seems to me that `everyone` is correct. Chip & Pin probably is the the most secure system available, but, it is also true that it is `beatable`.
As far as I`m aware, you only need the PIN to bypass/unlock the magnetic strip which holds the more relevant information. Only the PIN is encrypted in the Chip. If the card holder is `shoulder surfed` say, it stands to reason all they need now is the card to be cloned (easily done) and they now have both a card and a pin to use at their leisure.
My other half had her cardwallet stolen recently. They did not stop to ask for the PIN numbers. However, within hours they had taken out over £1200.00 in cash from three separate cards (two were new Chip & Pin cards) and purchased two expensive railway tickets. It took three attempts on one card to get cash. The others were no problem.
Heres one for the Pro Chip & Pin fan club...if SHE did`nt know her PIN`s....how come the thieves did!!.
I ask this question of anyone associated with Chip & Pin farce.......Is The Chip & Pin System 100% Secure!!????