Identifying Security Issues Identifying Security Issues in the - - PowerPoint PPT Presentation

Identifying Security Issues Identifying Security Issues in the Retail Payments System

Evolution of Payments System Fraud David A Poe - Director David A. Poe - Director June 5, 2008

Fraud has moved from amateurs

• perating locally to professionals operating globally
• perating locally to professionals operating globally

Fraudsters now work cooperatively across geographies, making

local regulations and law enforcement initiatives less impactful local regulations and law enforcement initiatives less impactful

1980 1990 2000 Current

Cardholders Small Merchants Mega Stores

Target

Members / Processors

+ + +

Cardholders Small Merchants Mega Stores Members / Processors

dster

+ + +

Individuals Team Organized International

Fraud

+ + +

aud Type

+ + +

1

Fra

Skimming Lost & Stolen Data Compromise X-Border DC

Fraud has moved from amateurs

• perating locally to professionals operating globally
• perating locally to professionals operating globally . . .

Fraudsters view fraud perpetration as a line of business

Perform competitive

assessments to evaluate points

• f greatest opportunity

VISA, MasterCard USA (with cvv2 code) VISA, MasterCard USA (with cvv2 code)

Select products, channels and

geographies (and even FIs) based upon matrix evaluation f lik lih d t it f d

5.0 есть в продаже 5-50 цена в $USD идентификация количество

, ( )

5.0 есть в продаже 5-50 цена в $USD идентификация количество

, ( )

• f likelihood to commit fraud

versus potential impact

Provide product pricing to

distribution channel based

3.0 есть в продаже 501-1000 4.0 есть в продаже 101-500 4.5 есть в продаже 51-100 р д 3.0 есть в продаже 501-1000 4.0 есть в продаже 101-500 4.5 есть в продаже 51-100 р д

distribution channel based upon expected likelihood versus impact

Hire specialists based upon

Если Вам нужно более 10000 карт, свяжитесь с нами, В б пишите есть в продаже более 10000 2.0 есть в продаже 1001-5000 Если Вам нужно более 10000 карт, свяжитесь с нами, В б пишите есть в продаже более 10000 2.0 есть в продаже 1001-5000

Hire specialists based upon

technology expertise

Invest in R&D with working

capital generated from

для Вас будет отдельная скидка для Вас будет отдельная скидка

2

p g proceeds

Source: iDefense

Players often make suboptimal fraud risk management business decisions because the true cost of fraud is often misunderstood the true cost of fraud is often misunderstood

True Cost of Payments Fraud True Cost of Payments Fraud

3

Technology is increasingly used to enable or ease the perpetration of payment fraud to enable or ease the perpetration of payment fraud

New technologies have enabled new means for fraudsters to

g illegally source or use information to perpetrate payment fraud –doing so across products, channels and geographies T h l i bli f d t t l

Technology is enabling fraudsters to leverage cross-

portfolio opportunities, compromising the full customer relationship

Fraudsters’ use of technology is driving the 5 highest growth

sources and uses of fraud account information

Phishing/Pharming Mass Data Compromise Identity Fraud Counterfeit/Skimming

• 4

Card-Not-Present (especially Internet purchases)

Some FIs are moving from a product silo to a customer relationship management approach to a customer relationship management approach

This approach extends into the way FIs are managing fraud risk This approach extends into the way FIs are managing fraud risk EVOLVING MANAGEMENT APPROACHES

PRODUCT MANAGEMENT

EVOLVING MANAGEMENT APPROACHES

R E LA T IO N S H IP R E LA T IO N S H IP R E LA T IO N S H IP R E LA T IO N S H IP R E LA T IO N S H IP R E LA T IO N S H IP

S F E R D I N G A R D R D

M A N A G E M E N T M A N A G E M E N T M A N A G E M E N T

D D A C redit C ard D ebit C ard

P R O D U C T S P R O D U C T S

C heck A C H R etail Lending H E LO C W ire T ransfer

M A N A G E M E N T M A N A G E M E N T M A N A G E M E N T

D D A C redit C ard D ebit C ard

P R O D U C T S P R O D U C T S

C heck A C H R etail Lending H E LO C W ire T ransfer

A C H R E T R A N S T A I L L E N D D A C H E C K R E D I T C A E B I T C A H E L O C

R etail B ank W holesale B ank

LIN E S O F B U S IN E S S LIN E S O F B U S IN E S S

A TM P hone P O S

C H A N N E LS C H A N N E LS

Internet B ranch M

• rtgage C
• m

pany R etail B ank W holesale B ank

LIN E S O F B U S IN E S S LIN E S O F B U S IN E S S

A TM P hone P O S

C H A N N E LS C H A N N E LS

Internet B ranch M

• rtgage C
• m

pany

W I R R E T C R D

A TM P hone P O S Internet B ranch N eural N etw

• rks

Internet T w

• -Factor A

uthentication

FR A U D S O LU T IO N S FR A U D S O LU T IO N S

C hip/P IN

G E O G R A P H Y

A TM P hone P O S Internet B ranch N eural N etw

• rks

Internet T w

• -Factor A

uthentication

FR A U D S O LU T IO N S FR A U D S O LU T IO N S

C hip/P IN

G E O G R A P H Y

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