Cyber crime expert in warning over chip and pin technology

Chip and pin payment technology may be compromised by hackers within a year, a US cyber security expert and former White House chief said.

Theresa Payton warned institutions needed to be thinking about future ways of protecting card transactions after managing to break through security in a test laboratory.

As America continues to roll out chip and pin, people needed to be ready for card not present fraud to go "through the roof".

She added: "We found in the ethical hacker labs we have been able to spoof chip and pin at the sales terminals.

"If we can do it in the lab, it is usually within a year that the bad guys can do it on a commoditised, scalable rate - so be ready and be thinking about what is after chip and pin.

"You have got about 12 months."

Mrs Payton was the first woman to serve as US President George W Bush's White House chief information officer and oversaw IT operations in an environment where everything including a chicken fillet had its own barcode.

She is chief executive officer of fraud consulting firm Fortalice Solutions LLC and addressed a meeting of the World Credit Union annual conference in Belfast.

The cyber-crime expert said international cooperation on tackling online financial fraud had improved, but was not good enough.

Although there is near 100% international cooperation on tackling child pornography, on finances it is a lot harder.

She added: "It is frustrating because we are funding terrorism every single time they get away with it."

She said people ignored the security of the payments system at their peril, adding: "We need to do better at actually locking people up and shutting them down.

"It is getting better but it still has so far to go. I am angry every time one dollar ends up in a bad guy's pocket."