Thieves in the US are putting identity theft to good use – using the Apple Pay system to purchase high-value goods.
As The Guardian reports, banks have been caught off guard by the amount of frauds happening and are “scrambling to ensure that better verification and checking systems are put in place to prevent the problem running out of control”.
Even though the system has been introduced less than half a year ago, already some two million Americans are using it.
Apple’s security systems have not been breached, though. Crooks are using new iPhones together with stolen identity information, and then they’re calling banks to ‘provision’ the victim’s card on the phone.
A spokesman for Apple reiterated that the secure mechanism for paying with card details stored on the phone had not been breached.
The Guardian says total losses are already running into millions of dollars.
Apple’s support pages for the service says: “When you add a credit or debit card to Apple Pay… Apple sends the encrypted data, along with other information about your iTunes account activity and device (such as the name of your device, its current location, or if you have a long history of transactions within iTunes) to your bank. Using this information, your bank will determine whether to approve adding your card to Apple Pay.”
As means of confirmation, banks usually ask the last four digits of a person’s social security number (SSN), but that number is often stolen and every year, some 11.5 million Americans are victims of identity thefts.
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