Reward cards withdrawn over fraud risk

Reward cards withdrawn over fraud risk
A European airline has withdrawn thousands of its reward-based credit cards after a major suspected card fraud was uncovered in Spain.

The Miles & More cards, which are issued by Deutsche Kreditbank,  were withdrawn by Lufthansa at the weekend and are among over 100,000 credit cards to have been withdrawn in total after a security breech at an unidentified Spanish payment processor.

German issuers Volksbank and Raiffeisenbank have recalled over 60,000 cards after advice from Visa and MasterCard, bring the total number of card recalls in Germany in recent weeks to 100,000.

Commerzbank, Deutsche Bank sand the German subsidiary of Barclays are reported to have cancelled thousands of credit cards between them as a precautionary measure. Last month the Karstadt-Quelle Bank withdrew 15,000 cards from circulation and last week.

It is thought that any consumer who has had a payment handled by the Spanish processor could be at risk, and their cards do not have to have been used in Spain.

Visa Europe says it is aware of a possible card data security issue in Spain, and said it had contacted some member banks to make them aware of the situation and any possible precautions that should be taken. MasterCard says it is monitoring developments to find out the extent to which card account data had been placed at risk.

News of the suspected fraud follows an investigation by Spanish police into a payment processing company in the country.

Visa and MasterCard reportedly warned banks about a potential problem four weeks ago when inconsistencies appeared on monthly statements.