This thing appears much bigger than anybody is letting on. We’ve seen a rash of stolen debit cards showing up on our PhoneGnome e-commerce site starting in late January. We had maybe one or two such things in all of 2005. Over the last few weeks, we’ve been consumed by fruadulent debit card activity. Nobody was providing any data as to what was going on. Not the banks, nor the credit card companies. Nobody. It’s ridiculous, “security through obscurity” mentality. The first time I heard anything is a story on the local news, by David Lazarus. His story hit the SF Chronicle today: OfficeMax at center of major data-security breach with debit cards.
We’ve seen transactions from all over the world using lost/stolen debit cards. Nobody will admit to it, but one has to wager, given the timing and how we have hardly seen any such activity until now, these cards are part of this breach. As a merchant, you would expect to be kept up to date. If we knew what to watch for, we could have been watching especially close for suspicious activity. But no. Nobody has anything to say about it.
As a consumer, I’m absolutely beside myself with the frustration of this system. We have tried to help the banks and the card-holders out by being proactive, to suggest to the banks that they may want to contact their customer about these transactions, to let those people know that their card might be out there being used fraudulently. I mean if we’re seeing this much activvity on our little PhoneGnome store, one can imagine what might be going on across the ecommerce universe. But these reports fall on deaf ears. The banks don’t even seem to have a mechanism for routing the call; they have no means for a merchant (or anybody) to provide a heads-up about a card that appears to be stolen. This means if someone uses my card somewhere else, and that merchant tries to tell my bank about it, they wouldn’t give the merchant the time of day, meaning I wouldn’t even know about the problem until my statement comes in, a month later.
When is the financial old-guard going to wake up to modern security practices and get out of the dark ages.
More importantly though, if you have a debit card, pay extra close attention to any purchases made with it.
