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Re: New secure credit cards?
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I had a chip card (for prepay electricity) and it died fairly quickly
(from static electricity AFAICT),

Re: New secure credit cards?
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Prepay chips are probably designed to have a significant failure rate.
Most people wouldn't bother to complain.

Sylvia.

Re: New secure credit cards?
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It should be very happy letting the bank know all sorts of interesting
things about your habits if it is a real smart card.

Re: New secure credit cards?
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It's intended to allow the banks to blame fraudulent transactions on the
customer.

See

http://www.chipandspin.co.uk/spin/index.html

Sylvia.

Re: New secure credit cards?

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Thanks for this Sylvia. I think it implies that Australians should not
change to using a PIN instead of a signature until the credit card
providers force us to. Agreed?

Re: New secure credit cards?
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Although I agree with the buck passing part of the Chip and PIN
argument, part of the reason for the leap in fraud on UK/European cards
is actually because other countries aren't using chip and PIN yet.

Just wait until your retailers get hold of the idea, at the moment I bet
they lose money on fraudulent card use, with chip and PIN the banks
guarantee the transaction and pass the cost onto the user.


--
Clint Sharp

Re: New secure credit cards?
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Yes. I have never had a PIN issued for my credit card, although
admittedly I have an EFTPOS card with a PIN.

Sylvia.


Re: New secure credit cards?
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I've had a PIN on my credit card for some time now, and I love it. You
can request a PIN for many cards, more and more places are accepting
the PIN now. Quite unusual for me now not to find a place that will
accept the PIN.

If credit cards had PIN only and no signature then they would be far
safer for over-the-counter transactions, as a stolen card couldn't be
used in a shop for instance, just like a stolen KeyCard. The quicker
they drop the useless signature the better IMO.

Online is different of course, but at least then the buggers are
trackable with goods delivery addressed and the like.

Dave.

Re: New secure credit cards?
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PINS can be captured by looking over someone's shoulder, by using video
cameras, by using compromised card readers (that can also copy the
stripe), etc. PINS are very insecure.

The advantage of a signature is that it has to be genuine (not merely a
good facsimile), otherwise you're not liable. The onus of proof is
pretty much on the bank.

Banks tend not to go out of their way to publicise it, but existing
signature based credit card fraud is largely a cost to the banks (and
ultimately spread amongst all users), rather than to the individual
whose card was missused.

Sylvia.


Re: New secure credit cards?
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But those technical means with which to acquire that PIN are not
trivial, almost certainly not available to your usual pick-pocket for
example. You can also overcome some of those issues by being aware.

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Yep, I know this, but still a pain in the arse when it happens, and
having the signature makes this more likely to happen I think if your
card is stolen.
But if say your wallet gets stolen and your card was only usable with
a PIN (or online where they can track you), it would be much less
valuable to the common thief.
With the signature method it's trivial to use that card to buy
thousands of dollars worth of un-trackable goods over-the-counter
before it gets reported stolen, hence making it a much more valuable
target to common thieves.

I'd rather have no signature and take my chances with the PIN.
The PIN is also much more convenient.

Dave.

Re: New secure credit cards?
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It's not the average pick-pocket who's the problem. It's organised groups.

Sylvia.

Re: New secure credit cards?

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It is extremely common in the UK.  The ATM near my local supermarket has had
pin capture devices removed from it twice in one day, and on several days
in one month.  I do not use machines that are not physically located inside
a bank unless I have to, and I am told by a work colleague that even one of
them has been found with a skimmer fitted.

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Except that the common thief can sell it to his local uncommon thief, and
then some money disappears from your account (as happened to a different
work colleague whose card *did* have a chip).  It is a commonly held belief
that if you report a phantom withdrawal in the UK you are likely to be
arrested for fraud, because the bank claims that its system is infallible,
so you must be lying, and the police arrive and take your DNA, and then it
is up to you to prove you DIDN'T make the withdrawal. Your main hope is to
find CCTV of yourself in a different town at the time in question but it is
not easy.  One school of thought is that it is better to just accept the
financial loss and forget about it.  Maybe this is what the bank wants.

google the following: chip and pin fraud

Chris


Re: New secure credit cards?

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A commonly held belief perhaps, but certainly untrue.

 > Your main hope is to
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I wonder what happens to those cases where the customer cuts straight to
the chase after the bank refuses a refund, and sues. It wouldn't
surprise me if a settlement invariably follows. Particularly if the
customer demonstrates knowledge of methods of defeating the security of
chip and PIN. The banks don't want that kind of publicity.

Sylvia.

Re: New secure credit cards?
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It's not up to the banks. They don't own the cards. Think about who
profits from the fraud, besides the fraudsters.

Re: New secure credit cards?
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The cards are owned by the card issuers, which in many cases are indeed
banks, in the normal sense of the word. However, for the purpose of this
discussion, "bank" is a convenient shorthand for whoever it is that
asserts the right to payment for amounts disbursed as a result of
fraudulent use of a credit card.

Sylvia.

Re: New secure credit cards?
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That's not how it works. There are 3 parties to the transaction apart
from the consumer. The banks are the "acquirers" and only one part of
the picture. They co-brand the card.

Re: New secure credit cards?
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Someone is asserting a right to payment. That's the only person the
consumer is bothered with.

Sylvia.

Re: New secure credit cards?
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That's an oversimplified view of the way it works.
There are three parties to the transaction. The merchant (who is the
party asserting the right to be paid), the network and the acquirer.
The two major CC issuers operate the network. They make a percentage of
the transaction in both charge and chargeback situations and
irrespective whether it is fraudulent or not. The acquirer (usually a
bank, but can be other companies) takes the credit risk and mostly
profits from the high interest rate on credit. However it's a high risk
unsecured credit transaction. The merchant must take all reasonable
steps to ensure that the identification of the customer and
authentication of the card. Failure to do this will render the merchant
liable for the fraudulent transaction (this is mostly the case). If the
merchant can show that all reasonable steps were taken to ensure the
integrity of the transaction then the acquirer takes the loss. Notice
how the network has absolved itself from the credit risk? There is very
little incentive for the network (who own the infrastructure and issue
the cards) to remedy the situation.

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My point was that the consumer is unconcerned provided they are not
expected to pay. Thus regardless of the underlying contractual details,
the only party that the consumer can be concerned about in the context
of a fraudulent transaction is the one demanding money from them.

Sylvia.

Re: New secure credit cards?
Hi,

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Many of the standard Westpac cards started including this since last
year, I've never seen or had any use for it in Australia though, but
when I was at a main Paris train station last year, I couldn't buy
tickets from any of the ticket machines because my credit card lacked
the "chip" on it. The machine only accepted cards with a "chip", and at
the time I hadn't received my new one yet. Very annoying, as I was
forced to queue up. That's the only time I ever had problems due to
lacking a "chip" on my credit card (they seemed to be much more common
in Europe).

Regards,

Ross..

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