The Irish Payment Services Organisation has reassured bank customers they would not be liable for any fraudulent transactions conducted on their cards.
It is estimated that credit card details of several hundred Irish customers were obtained by fraudsters several months ago but the scam was only detected last Wednesday.
IPSO head of card services Una Dillon said the scam was unusual because the fraudsters appeared to have waited several months before trying to use the credit card details illegally.
Investigators believe the details were obtained by either hacking into the company’s database or they were provided unlawfully by an employee of the firm.
Credit card companies were alerted by their own monitoring systems to unusual transactions last Wednesday evening after it was reported that a number of low-priced items were bought from a US online retailer using a range of credit cards belonging to Irish cardholders. It is believed such transactions were carried out to test if the credit cards were still valid before using them to make larger purchases.
However, a spokesman for US website Kosher.com insisted yesterday that no unauthorised credit card transactions were used to buy from his company.
But it is understood that the firm’s name did appear on credit card statements which helped to arouse suspicions about the illegal use of credit cards of consumers in Britain and the US as well. “I can’t explain how that happened,” said Kosher spokesman Brian Cooper.
IPSO said yesterday that investigations had not established the identity of the Irish company whose database was compromised.
However, Ms Dillon said the inquiry had been narrowed down to three or four online retailers, although it is uncertain if the identity of the database used by the hackers will be pinpointed because credit cardholders used the same websites.
IPSO said it was not clear if the name of the website would be made public, if identified.
However, Ms Dillon said financial institutions had cancelled the credit cards of any customer whose details were used by the fraudsters.
She claimed up to 100 Irish credit cardholders may have been affected by the scam, while details of cards held by several hundred more customers may also be with the fraudsters.
Over the past 48 hours, affected customers have been contacted by financial institutions to notify them that their card has been cancelled and that they will be reissued with new ones.
However, Ms Dillon said people not already contacted by their bank were unlikely to be affected by the scam.
IPSO advised worried credit cardholders to regularly check their statements. Ms Dillon said the latest incident should not frighten consumers about making on-line purchases.
“There are many high-level, fraud prevention and security measures in place. Buying online is a lot safer than walking down the street with €500 in your pocket,” she remarked.