Credit Card Security

I recently had a miserable experience with credit card fraud and am not looking forward to having more high tech credit cards in my pocket as a result. I was pumping gas at a Chevron station in East Palo Alto. All seemed rather benign and safe. I swiped my credit card in the embedded machine in the pump. It asked me for the usual zip code info, approved and on I went with pumping the gas. I finished, took my receipt and drove off. About an hour later I get an email from Barclays Bank who handles the Virgin America VISA card (really cool looking card) stating that I had possible fraud activity on my card. I checked it online and noticed that there were two charges at that same Chevron station: my first legitimate one and another larger, fraudulent one for $120. I promptly cancelled it and the Barclays Bank folks were really good on the phone.

I asked around with several friends as to how this might possibly have happened. It’s not definitive but it’s theorized that there was someone at the gas station with a wireless device that somehow had activated the embedded chip in my credit card and somehow got access to information that obviously made them capable of a making a fraudulent charge on the card. Another possibility is that the gas pump somehow could have gotten hacked or intruded upon allowing access to be gained to the cards that get swiped through it.

So there are many credit cards with the embedded chips in them for contactless payments with the terminals at several merchants. Are we headed full speed ahead into a brick wall of a security hole with this embedded technology? What else is at risk?

  • Our healthcare with smart tags or cards that carry our health information?
  • Our passports with the new smart chips in them?

Will the move to using our smartphones or cellphones be safer for doing payments and commerce?

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2 comments on “Credit Card Security

  1. Ozzie,

    I have a good friend who works in senior management at a Bank in Santa Barbara. She warned me that they were seeing significant increases in credit card fraud coming from Gas Stations both in Los Angeles and San Francisco. Seems to be a new thing given the cost of gas.

    Sucks.

    Danielle

  2. Ozzie,
    Fraud like that is everywhere right now, but we shouldn’t necessarily blame the technology (or security) when we should be blaming this implementations.
    Credit cards with an embedded SIM require different implemtations from banks than mag-stripe….and here in the US, the banks are failing us, yet again!
    Chip and pin technology is more secure than mag-strips, however it sounds like you’ve got a chip but no pin implementation from your bank.
    It will take a forklift upgrade of PoS systems and a boat-load of cash and training to move our retail establishments and banks to chip and pin….and its unfortunate because they’re ahead of us in other parts of the world with this where studies are showing a marked reduction in fraud.
    Ah, technology…..

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