Citibank card fraud – magnetic strip to blame? – Financial Services – Breaking Business and Technology News at silicon.com

A Citibank ATM network breach in Canada, Russia and the UK could have been prevented if the bank’s US customers had chip and PIN technology on their cards, a leading analyst has said.

Citibank this week admitted that hundreds of its US customers had been affected when hackers broke into the ATM network through a retail store server and stole a “block” of PINs and the keys to decrypt them.

Avivah Litan, a research director for Gartner, told silicon.com: “You won’t have the same problem with a chip card. They are hard to duplicate but it’s pretty easy to copy a magnetic stripe.”

So, blame it on not having chips in our pockets?

Martin McMillan, CEO of Level Four, a company that builds software and testing tools for ATMs, said: “If you were to have a chip-only card, skimming would disappear. As long as you have a magnetic strip on the back of the card it will be susceptible to skimming.”

So, chip cards are the beat all, end all of fraud? No chips have ever been cracked, right?

Sure, right, I buy that.

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