EMV Group Addresses Expected Jump in CNP Fraud with Best Practices
April 16, 2015
As the October 2015 liability shift in the ongoing U.S. migration to the EMV standard approaches, a small, but growing, faction in the payments world (including us here at CardNotPresent.com) are ramping up education efforts aimed at online merchants to make them aware of the surge in fraud expected in card-not-present channels. While EMV will put a serious dent in counterfeit fraud at the POS, that fraud will not simply go away—it will move online. A pro-EMV industry group called the EMV Migration Forum yesterday released a white paper that outlines several best practices merchants can use in the near term to deal with the expected onslaught of CNP fraud.
The group’s Card-Not-Present Fraud Working Committee recommended a multilayer approach that includes stronger authentication methods, dedicated fraud tools, implementation of 3D Secure and tokenization. The paper explored the impact on all stakeholders (consumers, merchants, issuers and acquirers) for each of these solutions.
“As the U.S. migrates to EMV chip technology, it’s important that the payments industry makes a concerted effort to protect against the redirection of fraud from in-store to the card-not-present channel,” said Randy Vanderhoof, director of the EMV Migration Forum. “No single security mechanism can protect against all possible fraud scenarios. Instead, the best practice to protect against card-not-present fraud is to use a systematic, multi-layered approach using tools that work together to create a successful fraud reduction program. This white paper provides guidance for merchants, issuers and acquirers to construct solutions to strengthen their systems against vulnerabilities and to better protect transaction data from attacks and fraud as part of their overall EMV implementation strategy.”