Fraud fear prompts Bank of Ireland to restrict some debit cards

Bank of Ireland has been forced to impose severe restrictions on many customers' debit cards this week over fears they have been compromised by fraudsters.

The bank declined to say how many customers have had restrictions imposed on their cards although the number does appear to be significant.

“For security reasons we don’t disclose the volume of new cards issuing to customers’ homes,” a spokesman said adding that there was “heightened precautionary activity under way at the moment”.

Impacted customers have been told they can no longer use their existing cards for contactless transactions and they have been blocked from using them online while restrictions on using cards abroad have also been put in place.

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The bank said it would take at least a week for the issues to be resolved and for customers to be issued with new cards.

In a text message sent to some customers on Thursday the bank said it was “letting you know that your debit card may have been at risk of fraud. As a precaution we are sending you a new one. You can still use your existing card for chip and pin transactions using an ATM or terminal and your four-digit pin to pay. Your new card and a letter of explanation will arrive in the coming days. There is no need to contact us at this time”.

The text message failed to make it clear the precise nature of the restrictions and that they meant affected Bank of Ireland customers would be unable to use their cards for contactless transactions or make any online purchase.

A letter which is being now sent to customers contains slightly more detail. It says customers’ “Visa debit card may be at risk of being used fraudulently as your details may have been compromised, possibly as a result of card skimming. This happens when fraudsters use a small device to steal your card details.”

The letter says there is “no need for you to take any immediate action. We’ve already taken steps to protect your account”.

The extra security measures are described as a “short-term step and it may limit certain types of spending, like paying for goods and services online and abroad”.

The letter said anyone travelling abroad before their new card arrives would “need to make sure that you have other ways of making payments, such as a credit card. We don’t recommend carrying large amounts of cash. Please also make sure that we have up-to-date email and phone details for you.”

The bank has also urged customers to check recent payments and if they find any that were not authorised, to contact the bank immediately.

When contacted by The Irish Times a bank spokesman said that when the bank suspects that a debit or credit card has been put at risk of fraud it takes precautionary measures. "A risk of fraud can arise, for example, if an ATM is tampered with or through a third party data breach. Receiving one of these precautionary messages does not mean that your card has been used fraudulently," he stressed.

He said that in some instances the bank issues new cards as a fraud precaution measure. "Currently, there is heightened precautionary activity due to the increase in third-party data breaches, for example Ticketmaster and Marriott Hotel Group data breaches."

Bank of Ireland will actually profit from the decision to restrict cards. While it costs customers just 1 cent if they make a purchase using the contactless facility, they pay 10 cent if they use chip and pin in store and 25 cent each time they take money out at an ATM.

When asked about the extra charges customers are likely to face ahead of getting new cards the bank spokesman suggested customers could request cashback with retailers “to avoid additional fees while waiting on their new card”.