Apple Pay (Photo : Reuters)
A recent report shows that Apple Pay is being exploited by some criminals to perform fraudulent transactions using stolen identities and credit cards.
The incident was first reported by The Guardian and it said that criminals are exploiting a bug in the verification process wherein users can add a new card to a certain Apple Pay account which allows them to add stolen credits cards to their iPhone. The report added that while Apple Pay's encryption process was not tampered or breached and that fraudulent transaction only exploits the mention bug.
Many tech analysts point their finger to certain banking security protocol rather than put the blame on Apple alone. Some banks were reported to have loopholes when it comes to verifying credit card information when it is being added to Google Pay. These loopholes were not yet exploited extensively but this poses a question about how bank could adapt to the increasing demand of mobile payment services like Apple Pay, according to Quartz.
Apple also pointed bank security protocols as the reason for the reported fraudulent transactions saying, "Apple Pay is designed to be extremely secure and protect a user's personal information. During setup Apple Pay requires banks to verify each and every card, and the bank then determines and approves whether a card can be added to Apple Pay."
The fraudulent transactions on Apple Pay were first reported by mobile payment specialist Cherian Abraham.
While reports about fraudulent transactions on Apple Pay continued to increase, many major banking institution in the United States denied these allegations that their system are at risk when used into mobile banking platforms, according to The Verge. Among these banks were Bank of America and Wells Fargo.
