CAIRO: Following the biggest credit card fraud heist to ever hit Egypt, Arab African International Bank (AAIB) has called for a Fraud Forum, sponsored by Visa International.
Since the start of the year, Egyptian banks were faced by the dangerous threat of Internet hackers who had monitored credit card transactions during the past years and collected information about the cards and their users. Using this information, the hackers have started to purchase sellable commodities, especially in Europe and the Far East.
As a result, banks started to contact their clients, urging them not to use their credit cards until they were replaced by new ones. Banks paid the full expense of issuing the new cards.
Azza Hassanein, a client at the Arab Bank, told the Daily News Egypt that she was contacted twice in the past two months, and has not used her credit card in Egypt or abroad since. The “fraud fright has resulted in a general aura of uncertainty by clients and whether they can safely trust electronic transactions.
To address this issue, AAIB and Visa International have called on all banks to cooperate in the Fraud Forum to be headed by Dina Yassa, Deputy General Manager of Retail Banking at AAIB. The forum will aim to discuss the precautionary means that should be implemented to combat credit card fraud.
According to experts, Egypt is facing this crisis because its clients are still using the normal credit cards that have been replaced by the Smart Chip in all European countries. Apparently the Smart Chip’s security has proven to be inviolable. AAIB told the Daily News Egypt that they sent a letter to all their clients explaining the situation. “As a protective measure against potential fraud, AAIB international credit card transactions (Visa and MasterCards) are going to be suspended in foreign countries and activated only upon request. This means that you will experience a denial whenever trying an un-notified transaction abroad. This is a growing market practice worldwide as a response to the rise of fraud, the letter said.
Many people have found AAIB’s letter and other bank’s similar requests to be “inappropriate and “inconvenient. Mohamed Tawfik, a businessman who travels regularly has been contacted by his bank, but preferred not to mention its name. “I can’t be expected to call my bank every time I travel, especially that sometimes my trips are unplanned, he said.
“These measures aim to protect the client’s interest and not restrict them. Credit cards can be used in Egypt with no trouble as it will be easy to monitor any local fraud cases. However, abroad that will be difficult as we have to pass through several channels, Ahmed Maged, general manager of Retail Banking at AAIB said.
Former attempts to tackle this issue had been adopted when an Egyptian Fraud Forum Constitution had been unilaterally signed by the financial institutions represented at the National Fraud Forum of Egypt in conjunction with Visa International on January 22, 2007. This forum takes place every three months in efforts to eradicate credit card fraud completely.
Designed to facilitate the work of the Forum, the Constitution had aimed to help banks cooperate to collectively fight economic crime. It was authenticated by all member banks participating in the Forum as part of the proactive measures taken to keep Egypt a low-risk market for payment card transactions.
Seemingly the constitution failed to reach concrete results.
All banks have requested that clients update their information and inform them of departure and arrival dates – a plea that has been met with anxiety and distrust on the behalf of clients.