ORX News digest of the month – June 2019
- 10 July 2019
Every month the ORX News team publishes a featured digest from the ORX News Service. It's a detailed look at one of the losses reported in the media that month, and is handpicked by the team as one of the most interesting stories.
Chilean banks face outsourcing failures
Banco de Chile, Banco Falabella and Santander were among numerous Chilean banks forced to block and replace customer debit and credit cards in June after a fourth-party contractor, engaged by the banks’ ATM network provider Redbanc, stole information relating to approximately 42,000 cards. As of 11 June, 82 cases of fraud had been recorded totalling 23 million Chilean pesos ($33,000), for which banks will cover the costs.
Police discovered the theft as part of a wider investigation into a card cloning network. The former contractor had stolen the partial information of 41,593 cards used on Redbanc’s network and a point of sale (POS) system from a petrol station before attempting to guess the cards’ personal identification numbers (PINs). He did this using new cards that he had printed with the stolen information.
According to Chilean senator Felipe Harboe Bascuñán, the data breach occurred because Redbanc lacked adequate security measures regarding its suppliers.
A total of 13 financial and non-financial institutions blocked and replaced cards and contacted customers. Banco de Chile blocked 9,000 cards, Banco Falabella 6,000 and Santander 1,000. Scotiabank, Banco Crédito de Inversiones (BCI) and Banco Ripley were also affected, in what Chilean media described as the largest data breach involving debit and credit cards the country has experienced.
ORX News subscribers can read the full story on the ORX News website.