First American Bank has filed a complaint with the City of Chicago following reports of a data breach involving customer debit cards used in taxis in the city. Regina Waldroup reports.
First American Bank has filed a complaint with the City of Chicago following reports of a data breach involving customer debit cards used in taxis in the city.
The banking company, based in Elk Grove Village, is advising customers not to use debit cards, or any other cards, in local taxis and has filed a complaint with the City of Chicago Department of Business Affairs and Consumer Protection.
The bank alleges that a data breach occurs when a card is used in city taxis, including American United, Checker, Yellow, Blue Diamond and others that utilize Taxi Affiliation Services and Dispatch Taxi to process card transactions.
The bank said about 11 customers have been notified about charges on their accounts and that thieves have tried to make almost 500 fraudulent charges to cards, totaling $62,000.
"It makes you nervous," said taxi rider Matt King.
First American Bank reported knowledge of the breach to MasterCard just over two weeks ago, but transactions continue to be presented, according to a release from the company.
First American Bank said it is not sure exactly how many customers will fall victim to the breach, but believes the fraud is still happening.
Jerry Irvine, a member of the National Cyber Security Task Force, said he does not believe the breach is with the card readers in taxis, but rather somewhere in the companies that process the card transactions.
First American Bank claims it has made repeated attempts to deal directly with Bank of America Merchant Services and Bank of America, the payment processors for the taxis, to discontinue payment processing for the companies suffering this compromise and to contain the fraud on customers’ accounts.
“These companies appear to not have stopped the breach,” First American Bank said in a statement. Since identifying the scheme, First American Bank has continuously monitored activity on its customers’ cards. Until the situation is rectified, First American Bank will close and reissue cards that have been exposed.”
"We are a little surprised that the wouldn't want to get on top of it," said Christine Childers from First American Bank.
Bank of America and local taxi companies said they are looking into the matter.
"Bank of America Merchant Services takes allegations of data security matters very seriously and is following all industry rules and legal mandates to research this issue," Joe Rauch of Bank of America Merchant Services said in a statement.
And the Department of Business Affairs & Consumer Protection is also investigating the claims.
"We take the issue of credit card fraud and consumer protection very seriously and we intent to full investigate these allegations," said Maria Guerra Lapacek, commissioner for the Department of Business Affairs & Consumer Protection.
It was not immediately clear if other banks were impacted.