The phenomenon of payments fraud is not a modern one — far from it.
But as RL Prasad, SVP of payment system risk at Visa, told Karen Webster in a recent conversation, what is new today is the who and the how of fraud, particularly in a digital world.
As for the who, Prasad told Webster that there are still plenty of attacks perpetrated by the more professional organized crime-modeled hacker gangs that are behind massive breaches that capture the headlines. But these fraudsters aren’t the only players in the game — and by and large, they aren’t the best at being the worst when it comes to efforts to infiltrate global payments systems.
The frequency of state-sponsored attacks has intensified in recent years — with a level of sophistication and technical and financial backing to their operations that has never before been seen. Cash-out scams, he noted, used to be about harvesting thousands and perhaps even hundreds of thousands of gift and prepaid cards in a heist. Today, when they are the product of state-sponsored rings, those attacks can mean millions of dollars leaving ATMS in minutes in a coordinated worldwide assault.
That leads to the second big change in the world of fraud, Prasad said – the expanded scope and reach of its targets. What was once limited to defrauding retailers at the physical point of sale with counterfeit cards is now digital, and accomplished by a variety of methods.