Security breach could expose 40M to fraud (40 million credit cards captured by computer virus)

Associated Press | June 18, 2005 | JOE BEL BRUNO

[HAL9000]

NEW YORK - A security breach of customer information at a credit card-processing company could expose to fraud up to 40 million cardholders of multiple brands, MasterCard International Inc. said Friday.

The credit card giant said its security division detected multiple instances of fraud that tracked back to CardSystems Solutions Inc. of Tucson, Ariz., which processes transactions for banks and merchants.

MasterCard said in a news release late Friday afternoon that it was notifying its card-issuing banks of the problem.

CardSystems was hit by a computer virus that captured customer data for the purpose of fraud, said company spokeswoman Sharon Gamsin. The FBI was investigating.

MasterCard, which said about 14 million of its own cards were exposed, said it was giving CardSystems a "limited amount of time to demonstrate compliance with security requirements."

John Perry, chief executive officer of Cardsystems, did not immediately return calls. Nor did officials from American Express and Visa; Discover had no immediate comment. MBNA, a large issuer of cards, also did not immediately return a call.

The breach is the latest in a series that has hurt a number of high-profile companies - including Citigroup Inc., Bank of America Corp. and DSW Shoe Warehouse.

It also appears the largest involving financial data, said David Sobel, general counsel at the Electronic Privacy Information Center.

"The steady stream of these disclosures shows the pressing need for regulation of the industry both in terms of limitation in the amount of personal information that companies collect and also liability when these kinds of disclosures occur," Sobel said.

That the breach involved a third party also "indicates that this is a shadowy industry where the consumer never really knows who is going to be handling and using their personal information," he added." Presumably, the affected consumer thought they were dealing with MasterCard."

Earlier this month, Citigroup said United Parcel Service lost computer tapes with sensitive information from 3.9 million customers of CitiFinancial, a unit that provides personal and home loans.

There have also been breaches involving other kinds of sensitive data.

ChoicePoint Inc. said in February that thieves using stolen identities had created 50 dummy businesses that pulled data including names, addresses and Social Security numbers on as many as 145,000 people.

In March, LexisNexis Inc. disclosed that hackers had commandeered a database and gained access to the personal files of as many as 32,000 people.

The company has since increased its estimate of the people affected to 310,000. Information accessed included names, addresses and Social Security and driver's license numbers, but not credit history, medical records or financial information, corporate parent Reed Elsevier Group PLC said in a statement.

"Hardly a week goes by without startling new examples of breaches of sensitive personal data, reminding us how important it is to pass a comprehensive identity theft prevention bill in Congress quickly," said Sen. Charles Schumer, D-N.Y.

[Mr Cobol]

Correct you are. It's Barry.

[apackof2]

I like your tagline.....you shall know the truth but first it makes you miserable LOL

[Calpernia]

ping

[Calpernia]

PayPal uses the Master Card logo. I would assume the breach encompasses brokers of their brand.

[null and void]

The truth shall set you free. I've been free of a good night's sleep for quite some time...

[familyop]

"We should also mention that the company did not use encryption on their files to cut back on costs."

That's a very important consideration and should probably be in the forefront for the general topic. If a cracker can't get the encryption key from/for a well encrypted drive, stolen data won't do that cracker any good. And use of encryption by an admin. requires an admin. who is very studious and experienced at using it (due to all unused bits needing to be randomized, knowledge of news on differences between encryption types, key security measures and the like).

[tubebender]

I have a Master Card from Wells Fargo. Unnnngh!!!

[Golden Eagle]

I once thought better of you than jumping to conclusions such as how this breach occured. Do you currently have ANY proof of your theory that Microsoft is somehow responsible? This is at least the second or third time you've done this now.

[snowsislander]

I once thought better of you than jumping to conclusions such as how this breach occured. Do you currently have ANY proof of your theory that Microsoft is somehow responsible? This is at least the second or third time you've done this now.

I saw an article on the Wall Street Journal website about this, and it is using the word "infiltrator" rather than "virus". I posted it at http://www.freerepublic.com/focus/f-news/1426286/posts

[Golden Eagle]

Thanks, from your link:

MasterCard said the intruder had breached the network by using a computer code or script.

[Aquinasfan]

but also 'beeber' and 'stuned'

And 'moose' and 'cheese.' Wasn't even funny the first time.

[RegulatorCountry]

"Could cause great chaos in our financial markets."

That is one stated objective. It's not foolish to speculate in that direction.

[frgoff]

No, the ultimate fault lies with the Nimrods who continue to insist on using such a piece of swiss cheese software to maintain sensitive information.

I can guarantee this would not have happened on a UNIX system (pick your flavor).

[frgoff]

Name an OS that has no vulnerabilities or weaknesses.

Let's try a more meaningful statement:

Name an OS that has not easily exploitable by script kiddies vulnerabilities or weaknesses.

Answer: Any OS other than Windows.

Corollary: Only a fool runs Windows when your systems need to be secure.

[appalachian_dweller]

Thanks for the ping Calpernia. I paid off and canceled all my credit cards and I refuse to get anymore. So this time information was stolen. IMO, the only reason the company is upset is because they didn't get a chance to sell it first.

I hate bills. I hate mail. I hate voice mail. I don't even have an answering machine at home so I don't have to check my messages. I'm just hopelessly stuck in the 20th Century.

I've simplified my life. It keeps stress way down. If it weren't for my SSN and by job, the gobberment wouldn't even know I exist. I'm working on that one now.........

[Golden Eagle]

I can guarantee this would not have happened on a UNIX system (pick your flavor).

Oh really? How? There's not enough details yet to know for sure how the breach occured, but we have since learned that the company at fault was CardSystems, and CardSystems is currently looking for a UNIX DBA. I'm not about to make any wide ranging unsubstantiated comments myself, but thought those that have might be interested.

[N3WBI3]

Well I guess you can die in any type of car, so therfore when looking for a family car looking at crash ratings dont count..

[N3WBI3]

Umm enterprise level OS's have been based on BSD for years! SunOS used to be basically BSD (I think they are now ATT). Not until the last couple of years has MS started to be the servers that such important data was held on.

Hell if you wanted to bring down the whole internet there are only a few servers you would have to kill and they are all BSD.