New Apple Pay Solution Revealed After Millions Lost
By: Jim Stickley and Tina Davis
May 5, 2019
In 2014, Apple brought their Apple Pay option to the public. The concept behind mobile Apple Pay would revolutionize payments at retail stores by providing shoppers with a fast, private, and secure check out choice–all with the touch of a finger. But once hackers jumped on the Apple Pay wagon, what started with high hopes for a new payment era was later discovered to have multiple security issues. It seems that in Apple’s desire to simplify payments, it did not foresee the simplicity factor as a major source for exploitation.
The financial sector was enamored by this new way to shop, with over 500 U.S. banks happy to include Apple Pay for their customers. Countless retailers signed up as well. Apple Pay had hit the big time, but little did they know they’d also be facing a big time hit. Stories of massive fraudulent charges using Apple Pay shocked all involved, except for the hackers behind the purchases. One fraud hacking gang racked up $1.5 million in charges. Another group bought credit card data on the dark web (for $2 per card) and transferred them to mobile Apple Pay. Armed with a gang of stolen credit information, the hackers bought over $600,000 in Rolex watches and high-end computers…and then of course sold them.
Apple finally discovered the many loopholes in their system. The simplicity of using Apple Pay was undermined because the point-of-sale didn’t require any identity or address verification. Hackers also sidestepped having to clone credit cards, faking signatures, and the chip and pin technology by making their purchases in-store. Banks have also been warned to step-up their responsibility to stop the loophole for fraudulent purchases made with Apple Pay.
Where all of this leaves consumers has yet to be determined. In March of this year, Apple introduced its new credit card called the Apple Card. It lives in your Apple Wallet and can be used anywhere Apple Pay is accepted. New security measures have been taken, including a titanium laser-etched card for point-of-sale purchases. The snag, however, is still how to move forward with new payment technologies in a safe and responsible way. Until a hack-proof mobile pay account is created, consumers can take steps to keep their digital wallets safe.
Since digital wallets are not for everyone, the first consideration is whether a mobile digital wallet is for you. Should you decide to move forward, remember that if your phone is lost or stolen, all your payment data goes with it. When not in your possession, your phone must be locked for safety. Change phone settings to auto-lock with the shortest amount of time possible. If someone steals your phone, it’s good to know there is a good chance they will be locked-out of using it and your credit and you have enough time to report your device stolen before they can get to the data on it.
Finally, keeping close tabs on your charge statements, more than once a month, will alert you more quickly to fraudulent purchases. Although it’s not yet a perfect payment system, Apple and the financial sector are working on it.