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How could this happen? Why is the U.S. payments industry still using archaic and notoriously insecure magnetic stripe card technology? And will the episode change anything? American Banker answers frequently asked questions about the Target breach.
January 22 -
If retailers want to reap the rewards of consumer sales, they should also take an active role in protecting their data.
January 15 -
Compliance is a top growing expense, the regulatory bar has increased, banks needs better talent management and cybersecurity is everyone's problem.
December 20 -
Can credit bureaus be trusted with consumers' data? An investigation conducted by security blogger Brian Krebs calls the practices of these stewards of consumer credit histories into question.
October 22
Banks and credit unions are outperforming retailers in the war against credit card fraud, according to a new survey from Javelin Strategy & Research.
Retail giant Target, which suffered a
"Retailers, common targets for data-breach crimes, scored lowest in prevention and among the lowest overall," Javelin industry analyst Al Pascual said in a press release Wednesday. "The three retailer issuers reviewed placed lowest in prevention Cabela's WFB (29%), Target (22%), and Nordstrom (18%) indicating inattention to factors that could help to lower these issuers' overall incidence of card-associated fraud."
Financial institutions' anti-fraud measures fared better in the survey. Bank of America (70%) received the top ranking for the seventh consecutive year. USAA held onto the No. 2 slot for a second year with a score of 66%. Citigroup (63%) climbed to third place after ranking 11th in 2012. Wells Fargo (62%) and Associated Banc-Corp (59%) rounded out the top five scorers.
Credit card companies Discover Financial Services (54%), American Express (53%) and Capital One Financial (52%) were in the lower half of the rankings.
Javelin recommended a number of steps that all credit card issuers can take to reduce identity theft. Issuers should empower customers to prevent fraud by allowing them to opt into alerts for all card-not-present transactions, according to the company. Customers should also be allowed to mark certain kinds of transactions as ones that should automatically be declined, Javelin said.
Issuers can speed up fraud resolution by requiring customer service representatives to make follow-up calls within a 48-hour time period, according to the report. They can also reduce fraud by using voice biometrics and call-analysis technology to authenticate cardholders rather than Social Security numbers, which are often vulnerable to security breaches.
Javelin's Credit Card Issuers' Identity Safety Scorecard evaluated the 24 credit card issuers between October and November 2013.
