Well known and popular card readers also known as POS devices that using in POS terminals are open to multiple critical attack vectors that put credit/debit card at high risk to steal the card data.
Two Security researchers Leigh-Anne Galloway & Timur Yunusov take the project that involved to analyze across the US and Europ using seven card readers in that belongs to different vendors such as iZettle, PayPal, Square.
They uncovered that more than half of the Mobile Point of Sales terminals are vulnerable to some form of attack and they identified 2 terminals could allow to sending of arbitrary commands by attackers.
Once attackers exploit the vulnerabilities then it provides full access to the terminals operating system that leads an attacker to enable plain text mode from encrypted Transaction to collect the PIN from Victims.
Attack vectors are using social engineering techniques to force a cardholder to use a less secure method of payment, such as mag-stripe.
Another method that is used to display a “Payment declined” message in order to make the cardholder to carry out additional transactions.
According to Researchers, We identified five terminals that are vulnerable to amount modification for mag-stripe transactions. also, you can see their Video presentation at DEFCON conference.
“This vulnerability can be used by a fraudulent merchant to force a cardholder to approve a much higher value amount. During the transaction, the merchant displays a different, lower amount on the card reader, and another higher amount is sent to the Mobile Point of Sales provider for approval.”
The team also found that it’s possible to carry out a man-in-the-middle attack using this Bluetooth access to intercept the HTTPS traffic between the mobile application and the payment server due to the vulnerabilities that exist in the five terminals.