PIN Scandal 'Worst Hack Ever'; Citibank Only The Start
The scam has hit national banks like Bank of America, Wells Fargo, and Washington Mutual, as well as smaller banks, all of which have reissued debit cards in recent weeks, says a Gartner research vice president.
The unfolding debit card scam that rocked Citibank this week is far from over, an analyst said Thursday as she called this first-time-ever mass theft of PINs "the worst consumer scam to date."
But Citibank is only the tip of the iceberg, said Avivah Litan, a Gartner research vice president. The scam -- and scandal -- has hit national banks like Bank of America, Wells Fargo, and Washington Mutual, as well as smaller banks, including ones in Oregon, Ohio, and Pennsylvania, all of which have re-issued debit cards in recent weeks.
"This is the worst hack ever," Litan maintained. "It's significant because not only is it a really wide-spread breach, but it affects debit cards, which everyone thought were immune to these kinds of things."
Unlike credit cards, debit cards offer an additional level of security: the password-like Personal Identification Number, or PIN.
"That's the irony, the PIN was supposed to make debit cards secure," Litan said. "Up until this breach, everyone thought ATMS and PINs could never be compromised."
Litan's sources in the financial industry have told her that thieves hacked into a as-yet-unknown system, and made off with data stored on debit cards' magnetic stripes, the associated "PIN blocks," or encrypted PIN data, and the key for that encrypted data.
5 Top Federal Initiatives For 2015As InformationWeek Government readers were busy firming up their fiscal year 2015 budgets, we asked them to rate more than 30 IT initiatives in terms of importance and current leadership focus. No surprise, among more than 30 options, security is No. 1. After that, things get less predictable.
Join us for a roundup of the top stories on InformationWeek.com for the week of December 7, 2014. Be here for the show and for the incredible Friday Afternoon Conversation that runs beside the program!