New technologies continue to have a tremendous impact on how, when, and where people make purchases, but they also open businesses up to vulnerabilities that leave them susceptible to a variety of cyber attacks and privacy-related claims. While the specific types of these cyber attacks are constantly evolving, one can be especially problematic, the credit card breach.
Credit Card Breaches on the Rise as Email Phishing Attacks Increase.
This type of cyber attack is a double threat. Criminals may obtain credit card account numbers through compromised point-of-sales (POS) systems or in stores through stored credit card data on servers. They then use the credit card information to make purchases, but it’s usually the retailers who are left holding the bag. In addition to investigative charges, legal fees, and public relations costs, a retailer may also have to pay the credit card brand’s costs to replace the stolen credit cards and could be subject to class-action lawsuits and regulatory inquiries.
How it works
Trend
Historically, cyber criminals have used credit card readers and malicious code on POS systems to obtain customer credit card data. However, with the recent rise in social-based claims, we have seen a direct increase in the amount of card data that is compromised through email phishing attacks that place malware on computer systems.
Comprehensive employee training on how to identify suspicious emails can help prevent these types of credit card breaches. In addition, a retailer should ensure that its cyber insurance policies contain not only first-party coverage to respond to a credit card breach, but also coverage for card brand–issued assessments that may arise[1].
[1] Source: Chubb Insurance, Fourth Quarter ,2018.
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Lic. Salvador Curiel & Lic. Scarlett Martinez
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