Julien Pierre wrote:

Well, now you have heard one. What do you want me to do to prove it, give you the person's name, e-mail and and phone number, the name of the university ? I do have that info, but I don't believe she would want me to share it.


Of course.  The 1st issue here is whether it really
was a sniffing of a credit card.  (I believe you've
given the key clues below...)

The second issue is how much was lost, and then how
frequent it is.  Once we establish a cost of this,
and multiply by the frequency, we can then work
out how much to spend on protecting against it.

Say there were 1000 instances every year.  And we
lost $1000 each time.  I'm picking numbers here
which we should hear about.

That would be total losses of $1 million.  So that's
how much - give or take - we want to spend to protect
against credit card losses.  Across the net society.

Currently, certs are sold at about 40k per year [1].
Imagine each cert costs $1000 (include some hassle
time in there).

That makes for total costs to protect against the
loss as $40 million.  If we only lose $1m per year,
that's not a good deal.

Hence, we can conclude two things:

   * we really *really* want to know how many losses
     (like your friend's) there are, and

   * in considering the acceptance of a new CA cert
     by MF or any other, there isn't much economic
     support for insisting on costly protection such
     as audits.

[1] http://www.securityspace.com/s_survey/sdata/200401/certca.html

Also, I have seen legitimate (but security-ignorant) businesses that ask for credit card numbers by insecure e-mail. And very likely many security-ignorant customers will just volunteer the information over insecure e-mail.


Yes, I did a very basic test using google about
6 months back, and established there were about
10-30k sites who ask for credit cards without
using any form of SSL.  This sits against the
approximate 100k sites that use SSL (these
numbers are all orders of magnitude).  The
existance of significant numbers of people who
transmit CCs across HTTP or email is one reason
why I believe there to be unmeasurable numbers
of cases of snooping.

I don't need to tell you how vulnerable that is to snooping by all the ISPs and relays, or any thief in between. I don't have any stats on it, but I bet it's a significant cause of fraud.


Nope, I doubt it is even measurable.  Mind you,
it would be really nice if we could provide a
form of encryption protection to the very small
businesses that can't afford the current expensive
infrastructure.  (It is for this reason that I
suggest that Apache should install out of the
box with a self-signed cert immediately generated,
and Browsers should accept self-signed certs as a
valid protected session.)


And, I've been looking for the last decade or so...


Where ? What was your research based on ?


Anecdotal sources (talking to credit card people,
looking at the various media reports, etc).  No
company will reveal this formally, unfortunately,
:-/  I have challenged a lot of people in the
field on this point, and they've maintained their
silence...

Did you ask the banks for their statistics on credit card fraud ?


No, mostly the credit card people.


Try asking the US credit card processors why they charge a higher rate for online transactions than for retail transactions.

Almost all fraud is one of these classes:


    * insider fraud, where someone with access
      to the information sells it in bulk,
    * hacks of boxes, or
    * false charge-backs.  This latter is very
      prevalent in Adult/Gaming.

Because of these factors, in general, there is
a much higher rate for online transactions:

     * stolen batches of cards can be used over
       the net to acquire goods,
     * cards are at risk in the databases, no
       matter how many security instructions
       are sent out, and
     * high chargeback rates in different areas.

Not because of anyone sniffing on the wire.


> I don't think they
are just greedy (though they certainly are), but online fraud is a significant problem to them and they compensate for it by higher rate.


Right.  But, they know it is not to do with
sniffing on the wire.  If it was, they would
investigate where and when it was happening,
and identify which insiders were doing it.

For example, have you ever heard of a sysadmin
being arrested for sniffing credit cards?  Or,
an advisory that states that someone is sniffing
cards in this or that place?


However, it may be difficult to establish in many cases how exactly the credit card numbers were compromised since there are so many different ways. And the thieves probably don't go and brag about the most popular methods.


Actually, it is fairly well known how it is
all done.  There are chat groups and rooms
and so forth where one can pick up the info
on how to do it, and find prices to buy, etc
(don't ask me *where*, that's not my game,
but I gather it is mostly in IRC and some of
the anon variants...).


.... She knew this for a fact because
it had happened to other people as well and word had gotten out that there were people snooping on the university network (but they had not been caught yet).


Ah, well, that latter part is certainly apropos.
If there were a bunch of these events happening,
then it is a plausible conclusion - looks like
this may be a case of students snooping over the
uni networks!


> ... After
they reversed the charges, they canceled the old card account number, opened a new one with a new number, and sent her the new card very securely ... via US postal mail.


OK, so her cost was zero dollars, and some wasted
time and hassle.  The bank reversed the charges
on the merchant, so the merchant was out for the
cost of the goods sent.


> I believe this to be very common. And
this is one of the key risks SSL tries to protect against.


Well, I've been told by people who worked at
credit card companies that they've never ever
seen any proven case of credit cards being
compromised while on the wire.  But, they
can document squillions of cases based on
insider fraud, cracking, etc.  This is all
informal, of course, so I'm curious as to how
to establish this more scientifically.


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