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Fraud Schemes Target Small Merchants

September 5, 2013

Recent network break-ins by cyber thieves reflect a growing migration of payments fraud from major merchants to smaller and mid-sized retailers.

Former federal prosecutor Kim Peretti says indictments of five cyberthieves with alleged connections to Heartland Payments hacker Albert Gonzalez and network break-ins that affected Global Payments and others reflect a growing migration of payments fraud from major merchants to smaller and mid-sized retailers. She notes that the advantage of hitting smaller targets is the accumulation over time of a substantial number of stolen payment cards to resell. The latest indictments revealed that one defendant was tasked with breaching systems to steal large amounts of card numbers as well as accessing certain processors to acquire a small number of prepaid cards to be exploited via ATM fraud.

“Typically, we have seen different indictments brought for those two very separate types of activities, and now we’re seeing at least one individual who has the skill set to be responsible for those different types of attacks,” Peretti points out. She notes a trend in which top fraud groups “have pushed down to other groups, particularly in Eastern Europe. Peretti believes the indictments will serve as a deterrent for future cybercrime, especially when criminals based abroad realize that U.S. law enforcement can identify and apprehend them. – From “Fraud Schemes Targeting Small Merchants” BankInfoSecurity.com (08/30/13) Roman, Jeffrey

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