SwimOutlet.com Breached in 2016 – 51 days later..and after the holidays…we were notified. January 19, 2017Posted by Chris Mark in Data Breach, Uncategorized.
Tags: Breach, compromise, credit card, CVV2, debit card, dta, fraud, hack, payment card, PCI DSS, swimoutlet.com, yogaoutlet.com
This is a post to notify those who may be affected. Yesterday I received the following letter in the mail. It was sent in a nondescript envelope and nearly discarded as ‘junk mail’. Upon opening the letter I was shocked to read that my wife’s credit card data appears to have been compromised at SwimOutlet.com. It should be noted that the same infrastructure is used by YogaOutlet.com. In reading the letter provided to the State of Oregon’s Attorney General, it appears that over 6,200 Oregon residents likely had their data stolen.
Within the letter there is a curious statement that says: “The information at risk as a result of this event includes the cardholder name, address, phone number, email address, card number ,expiration date, and CVV“. For those in the credit card industry the inclusion of CVV is very troubling. Under the card brand operating regulations and PCI DSS standard, it is prohibited for a merchant to retain CVV subsequent to authorization of the charge. This particular type of data (actually the CVV2 or equivalent data) is what is needed to authenticate a transaction. In short, the likelihood of fraud increases exponentially when a criminal captures CVV2 type data. It is certainly curious that this ‘prohibited data’ is listed as an element that may have been stolen.
In reviewing the SwimOutlet.com website I notice a conspicuous absence of any form of notification on their website. Their blog is filled with helpful tips on swimming better and eating better but there is no mention of the fact that their user’s credit and/or debit card data was stolen. A review of their Facebook page has the same conspicuous absence of any notification or information. Their Twitter feed is also absent of any information.
If one looks at the timeline of events, there are some disturbing (to me, at least) items. On October 31st, 2016 SwimOutlet.com “…began investigating unusual activity reported by (our) credit card processor.” On November 28th, 2016 SwimOutlet.com received ‘confirmation’ that their systems were ‘hacked’ yet the notice states that data may have been compromised as late as November 22nd, 2016. I have been involved in numerous data breach investigations and incidents. “unusual activity” notifications by credit card processors are ‘notifications of fraud’. This is a major red flag that the merchant HAS been breached. The notice then provides a qualified statement in saying that the beach: “…may have compromised some customers’ debit and credit card data…” Again, if notified by the credit card processor then the data ‘may not’ have been compromised it almost certainly was compromised.
What is most disturbing to me is that SwimOutlet.com had confirmation on November 28th, 2016 that they were breached. They had confirmation as early as October 31st, 2016 of ‘unusual activity’ yet chose to wait until AFTER the holiday season to notify affected consumers. Criminals are not stupid. They steal credit card data before the holidays to be used over the holidays when the fraud systems are often ‘detuned’ by retailers and the volume of transactions creates noise in which fraud is often harder to identify. By waiting until January 12th (we received the letter on January 17th, 2017) it created a situation in which we were blissfully unaware that our data had been breached. If we had been notified before the holiday season, we could have cancelled the card immediately and been saved the inconvenience and possible cost associated with this situation.
In the notice SwimOutlet.com does: “…encourage (me) to remain vigilant against incidents of identity theft and fraud.” This would have been sage advice BEFORE the holiday season. It begs the question why a major online retailer would wait until after CyberMonday and after the holiday season to notify of a breach?
Finally, SwimOutlet.com reassures the recipient that “We take the security of our customers’ information extremely seriously…” and that: “…you can safely use your payment card at http://www.swimoutlet.com”. In light of the method and delay of notification I am going to personally take my business elsewhere.
EMV- CHIP & Choice..not Chip & PIN…Start Moving! March 23, 2015Posted by Chris Mark in Uncategorized.
Tags: Chip & PIN, Chris Mark, data breach, EMV, EMVCO, fraud, Liability Shift, mastercard, PCI, visa
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After deviating from my ‘security’ theme, I am back to talk about InfoSec. Last week I had the opportunity to attend Visa Accredited EMV Consultant Training at Visa’s Headquarters in Foster City, CA. As always, Visa put on a top tier program with numerous experts in Payment Card ‘chip’ technology. Since the topic was EMV most of the experts were from Across the Pond. Thanks to Mark, Chris and the others for great training!
For those who are new, EMV or “Europay, MasterCard, Visa” is a technology where a microprocessor ‘chip’ is embedded in a payment card (credit card, debit card, etc.). It is often erroneously referred too as “Chip & PIN” but EMV really only applies to the Chip technology. If a region or issuer wants to prefer PIN, they are able. Visa has a “Chip and Choice” model where they allow Chip with signature, no signature, or PIN depending upon the issuer, the risk and type of transaction (ie. Debit for Cash or ATM require a PIN). There was too much information over 2 days to talk about in this post but there was one point I learned and wanted to pass on..
In October 2015, Visa is offering a ‘liability shift’ for merchants who adopt EMV. My belief (it was wrong) until I attended the training was that the EMV liability shift only affected those merchants who 1) accepted a ‘chip’ card and on ‘chip’ transactions. These are known as ‘chip on chip’. It is critical that Merchants understand that the liability shift occurs for merchants who accept transacitons over a dual interface terminal (Chip and NFC) who accept transactions of ANY form. As an example, if you accept 99% mag stripe transactions but you have dual interface terminals…the fraudulent transacion due to counterfeit have liability shifted to the issuer! It does NOT have to be a Chip on Chip transaction.
The Second important point to remember is that Visa is offering a Technology Incentive Program (TIP) that states if a Level 1 Merchant accepts 75% of transactions over a Dual Interface terminal, they do not have to validate compliance with an onsite assessment. There are some caveats to this so make sure you read the rules!
To get ready for implementation, ensure you download the Visa Merchant Readiness Acceptance Guide here.
2012 European Central Bank Report on Card Fraud August 6, 2012Posted by Chris Mark in News.
Tags: Chip and Pin, debit, ECB, EMV, european central bank, fraud, maestro, mark consulting group, mastercard, PCI DSS, SEPA, visa
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In July 2012 the European Central Bank released a report on bank card (debit, credit, etc.) fraud in the Single Euro Payment Area (SEPA). According to the report, the total fraud equaled €1.26 billion in 2010. For those in the payments industry, this report is an interesting look at the fraud patterns related to card usage. You can download the report here.
2012 – Another “Massive” Credit Card Breach March 30, 2012Posted by Chris Mark in Industry News, InfoSec & Privacy.
Tags: Chris Mark, data breach, fraud, InfoSec, mastercard, PCI DSS, security, visa
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According to Krebsonsecurity, the payment card industry has been wracked by yet another massive data breach. The story says that Visa and MasterCard are alerting companies to a US processor that was breached. This, according to reports, is a breach of Track1 and Track2 data. For those unfamiliar with credit cards, track1 and track 2 data is what is known as “magnetic stripe data” and is used to counterfeit cards as it contains the sensitive authentication data necessary for retail (card present) transactions. This is the most dangerous and valuable data to criminals.
As stated on the site: “In separate non-public alerts sent late last week, VISA and MasterCard began warning banks about specific cards that may have been compromised. The card associations stated that the breached credit card processor was compromised between Jan. 21, 2012 and Feb. 25, 2012.”