Santander To Track Customer Location Via Mobiles and Tablets

New submitter raburton writes: Santander (one of the biggest banks in Europe) slipped a little note on the corner of my latest statement saying they intend to start collecting "location or other data" from mobiles and tablets that their customers own, from 1st July 2015. There is no link to further information about the policy, or any suggestion you can opt out of it. The stated aim is of course to "prevent and detect fraud", but once they have the data (and they'll probably keep it for a long time) they, or anyone who can gain access to it, can do whatever they like with it. In this day and age I find it hard to take any assurances to the contrary very seriously. Is this kind of policy common practice with banks elsewhere?

Comments

extremely common fraud protection

[raymorris]

Many, possibly most, ecommerce sites do at least basic location checks for fraud protection and have for many years. The 20,000 or so sites which use our software have done so for at least ten years. If you're on the site from Comcast San Francisco at 10:00, then an hour later someone claiming to be you tries to initiate a transaction while in Russia, that's suspicious.

That red flag is then combined with other available information to choose from one of four possible outcomes:
The transaction is approved.
The transaction is declined.
The customer gets a call / text asking them to confirm the transaction.
Verified by Visa (tm) or the cashier calls in for manual approval.

The system works pretty well.

Note "tracking" is slightly overstating it for two reasons. First, the bank or processor checks only the location of the transaction- we don't know or care where you are if you're not attempting a transaction against an account holder's funds at the moment. Secondly, the "location" is strictly numerical longitude and latitude to see how far you are from the last location. Is it physically possible that you traveled that fast? We don't know or care if you're in a grocery store or a strip club. We only care if "you" are 4,000 miles from where you were two hours ago.

Re:extremely common fraud protection

[IamTheRealMike]

google really throws a hissy fit when I send email from my home (on a vpn) using imap. mostly they grey list me and time me out. but this anti-vpn concept annoys me. I don't believe it rejects fraud.

It does reject fraud. I know this because I designed the system at Google that is rejecting your logins, back when I worked there. There's a blog post about the system here. Obviously location (actually: geographical coordinates) are not the only thing that is used, it's just a signal that's carefully blended with others.

The main reason location works as a useful anti-fraud signal is that the datasets that hackers are working off are very sparse. Normally only usernames and passwords. So they don't know where in the world you live, meaning that they have to guess. It's almost like a second password. And mostly their guess will be wrong, leading to an ID verification check.

Now if you use VPNs or Tor or whatever that actually move you around the world constantly, then you're in a tiny minority of people that this heuristic doesn't work for. That's not so great. But here's a tip - if you enable 2-step verification on your Google account and then give your IMAP client an "app specific password" you shouldn't see rejected logins anymore, as is documented in the Google support pages. If your IMAP client knows how to use OAuth to log in, that would also work, but most don't.

Re: Guess who's not getting an account with Santan

[Anonymous Coward]

And this is the reason why capitalism of today doesn't work.

It's the glory of the Free Market.

As soon as you become successful, you can afford to start buying up the competition. That can make you more successful, so that you can buy up other competitors who have been buying up their competition. Until finally the ultimate stage of the pyramid is that there is no competition, because no one starting from scratch can afford to compete against the massive economies of scale that only a very large competitor can afford.

All Hail The Glorious Free Market!

Nope, it mostly works

[rsilvergun]

I'm in the payment industry and it pretty well works. There's more to it (metrics and whatnot that score up or down your transactions) but location is incredibly useful. Give it 10, 15 years and these sorts of metrics + big data parsing will pretty much eliminate point of sale fraud. Right now the only thing holding it back is processor cycles are still kinda pricy per watt in a data center, but that's changing more and more. Sure, Moore's law is done but we're nowhere's near done with reducing the energy footprint. Plus before long cell phones will replace your credit card, and when your "credit card" is a no longer a dumb piece of plastic but basically a super computer with tons advanced sensors in your pocket it opens up a whole new world.

I know it's popular to say the hackers and crackers will always come out ahead, but really they won't. In 10-15 years the only fraud left will be the large scale investor kind and the "legal" kind where you buy up a company Bain Capital style and suck the life out of it. Small scale credit card fraud is a dying breed.