Stealing from the rich, giving grief to the poor
By John Leyden • Get more from this author 2nd December 2011 12:36 GMT
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Charities are unlikely to benefit from an Anonymous-led operation attempting to use stolen credit card details to make donations to worthwhile causes.
OpRobinHood aims to defraud banks for the benefit of the majority and comes as a response by hacktivists to the crackdown on the Occupy movement. Anonymous has joined forces with TeaMp0isoN, another hactivist group, to run the campaign – which is an illegal and aggressive extension of an earlier push to persuade consumers to transfer their accounts from banks to credit unions.
Banks will inevitably seek to reverse any fraudulent transaction once card-holders complain, if not before. Initially we reckoned banks might levy a chargeback in such cases, potentially leaving charities who receive fraudulent donations out of pocket.
However, a spokeswoman for the UK Cards Association explained that the picture is more complicated than that and depends on the contract charities have with their payment processors and banks, which can vary widely across the industry. She told us:
As chargeback is run by Visa and MasterCard, only they will know the detail, and partly as this will be about the commercial contract between the business and their own bank.
In general, anybody who accepts cards will have a contract which will clarify where liability lies in the case of fraudulent transactions – the general thing being that if you are plugged into the most effective fraud prevention measures, then you (the retailer) won't lose out. Some charities may lose out (or just not get the money they thought they were getting – they won't lose twice) but some will.
However what TeaMp0isoN may find is that because real fraudsters often test to see whether the card details they have works by making a charitable donation, the transaction may be blocked anyway.
Rob Rachwald, director of security strategy at database security firm Imperva, explained that ultimately banking customers and not the banks themselves bear the cost of credit card fraud – not directly, but through increased fees. Anonymous is mistaken if it thinks that charitable donations using stolen credit cards offer any exception to this rule, he argued.
"From a consumer standpoint, there's no liability for a stolen card," Rachwald explained. "The fraudulent transaction is not charged back to the consumer. The problem is that this misleads consumers – and Anonymous – into thinking that consumers are spared while banks and retailers are screwed. Wrong."
He added: "The reality is retailers who accepted the stolen credit card (not knowing it was stolen) lose price of the merchandise purchased. Credit card companies increase fees and interest rates. Fraud costs, in effect, are distributed back to the general pool of consumers."
So it is members of the majority, not the banks, who are ultimately going to be left out of pocket by OpRobinHood, Rachwald concluded.
"So who's funding Operation Robin Hood? Anyone with a credit card. This very likely includes the many members of Anonymous," he said.
PoisAnon (Anonymous/TeaMp0isoN) has allegedly hacked into the systems of two banks but without making any fraudulent transactions. Hacktivists claim to have found vulnerabilities in the web-based systems of both the First National Bank of Long Island and the National Bank of California, according to documents posted onto PasteBin, ITWorld reports.
Both reports remain unconfirmed, as neither bank would reveal if illicit access to their systems had taken place. ®