Source: National Cyber Security – Produced By Gregory Evans
Among other things, Apple’s Second Coming of the Mobile Payment Solution was meant to fix our broke-ass credit card security system. Only, according to (unconfirmed) reports, it’s doing exactly the opposite. The Drop Labs blog has a good (if technical) post on how Apple Pay security does — and doesn’t — work. In essence, the hardcore tech stuff for Apple Pay works just fine: no-one is breaking TouchID, stealing iPhones to pay for stuff, or hacking the NFC transmission protocol. Rather, the flaw lies in credit cards themselves. According to Drop Labs, people are buying credit card numbers online, then loading those same numbers into Apple Pay, in essence making themselves a handy fake credit card, without going to the trouble of making a physical fake. And it’s not a small problem: Drop Labs claims that for some issuers, fraud levels are as high as 6% (meaning $6 of every $100 spent is fraudulent). That’s bad even when compared to regular credit cards, whose fraud rate averages out at under 1%. This is possible because of two flaws with the system. Most problematically, it’s easy for hackers to steal credit card numbers from stores, and then sell those numbers online. […]
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