PCI DSS drops ATM fraud 90% in Nigeria

At the RSA Conference in 2009 I presented “Top Threats to Personally Identifiable Information” for SafeNet where I attempted to prove from breach data that PCI DSS was having a tangible positive effect. My charts illustrated that despite breaches overall in a rise a filter for PCI DSS revealed a decline for industries adopting prescriptive compliance controls.

It was a tough illustration because of so many moving parts and the quality of data. My prediction that overall breaches would go down, because they already were going down in specific areas, was fun to try and prove. Yet everyone seemed to ask for more data on the biggest breaches instead of analysis of the overall trends. That is how my following presentations turned into the popular series called “Top 10 Breaches“.

Well, that’s not entirely the case. Each time I ran into Robert Hanson (RSnake) he asked for updates on the overall breach trend analysis. He kept reminding me that more people needed to see my contrariness. So credit goes to him for encouraging me to update the analysis and data for a presentation called “Message in a Bottle” for MetriCon. Unfortunately the Metricon presentation did not happen. It feels like it might be time to dust it off. This week I ran into an interesting update from Nigeria.

The Central Bank of Nigeria (CBN) announced six months ago that it was increasing compliance controls based on PCI DSS to combat financial fraud

…due to the failure of the nation’s banks to obey the CBN’s ATM regulatory framework and ensure compliance with these rules the apex bank rolled out penalties for non compliance with Payment Card Industry Data Security Standards (PCIDSS)

Modest fines were linked to the presence of audit trails and timeliness of response

…an ATM deployer would be made to refund the full amount involved in any fraud perpetrated on its ATM for failure to provide video recordings on the disputed transaction when required.

It pointed out that failure to respond to the customer or to the CBN on ATM complaints within 72 hours would attract a fine of N50, 000 [USD$300] per day for each complaint after the 72 hours until the response is received, adding that failure to resolve any ATM dispute with evidence of resolution within 14 days, would result in the deployer refunding the total amount involved in the fraud.

Similarly, the CBN stated that non-compliance with migration to EMV after September 30, 2010, will attract a fine of N50, 000 and the issuer will bear full liability for any fraud perpetrated with the magnetic-stripe card, adding that failure to provide audit trails and journals for ATM transactions would attract a fine of N50, 000 per week.

It further stated that for non-compliance with Payment Card Industry Data Security Standards (PCIDSS), a fine of N50, 000 per week will apply to the defaulter until compliance is established. It, however, said that non-compliance of ATM terminals with EMV levels 1 and 2, would attract a fine of N50, 000 and temporary suspension of the affected terminal unit until compliance is established.

Then, just this past week, the CBN reported that its compliance program has had a dramatic effect on ATM fraud

The Central Bank of Nigeria has said that the banking sector was on the way to recovery as banks Automated Teller Machine (ATM) frauds reduced by 90 per cent.

The governor of the apex bank and chairman, Steering Committee on Financial System Strategy 2020(FSS2020), Mallam Sanusi Lamido Sanusi, made this known on Wednesday in Abuja at the opening of the Strategy Execution Master Class of the FSS 2020.

In the banking sector, he said there had been a drastic drop in the level of non-performing loans adding that there had been structured growth of banks in the areas of capitalisation, capital adequacy and liquidity ratio.

They have not yet released data points to support this news. I am a skeptical believer and wonder how such a profound change can be extrapolated to the future from such a short time. It was announced with a suspicious amount of confidence. There must be more to the story than meets the eye. I can’t wait to see the numbers and roll them to the global data I collect for analysis of the trends and effects of compliance.

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