American Express fixes security issue with contactless cards

American Express has confirmed it has fixed a security loophole which had meant lost or stolen contactless cards could potentially be used after they had been cancelled.

It follows campaigning by MoneySavingExpert.com, which said other major card providers have also previously confirmed that they have made similar moves.

In 2016, a MoneySavingExpert.com investigation had found that lost and stolen contactless cards generally could potentially be used by criminals long after cancellation.

This happened because some lower-value transactions were being processed “offline” – meaning a customer’s bank was not immediately alerted when a transaction was made, so cancelled cards did not always receive the instruction not to work.

Offline payments are stored in batches by retailers, to be processed later on.

American Express said close to 100% of contactless transactions are now processed “online” – so banks are immediately alerted.

An American Express spokeswoman said: “Protecting our card members against theft is of paramount importance and they can be reassured that almost all of contactless transactions are processed online, which ensures that they are secure.”

Kirsty Good, head of campaigns at MoneySavingExpert.com, said: “Finally, after years of campaigning, the last major card provider has managed to close this security loophole, making this type of contactless fraud – with a few exceptions – a thing of the past.

“It was outrageous that consumers – months after cancelling their stolen cards – were seeing money fraudulently taken out of their account. All credit to Visa, Mastercard and American Express for tackling this head on.

“If your card is lost or stolen, you still need to tell your bank to cancel it as soon as possible.

“As always, be extra vigilant when looking at your account and flag any dodgy transactions. But thankfully, it’s now much, much less likely that this type of fraud will happen to you.”

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