October 22, 2015//Ellen NeveuxLast Updated: May 30, 2018
Hackers based in China have compromised the network of LoopPay—a Samsung subsidiary responsible for the mobile payment technology that supports Samsung Pay. Are users of Samsung devices and this new payment app at risk?
It’s a strong possibility.
In September of this year, electronics conglomerate Samsung launched Samsung Pay, a mobile pay method for Samsung devices available over certain mobile carriers. Released first in South Korea, Samsung Pay processed more than $30 million in transactions prior to launch in the United States.
Just two weeks later, Samsung subsidiary LoopPay announced that its corporate network suffered a security breach as early as March of this year. The breach was not discovered until August.
After the data breach at LoopPay became public, Samsung announced that its Pay technology operates from a mobile division at Samsung—not through the LoopPay network. However, the LoopPay breach remains under active investigation despite this reassurance.
According to a recent article in The New York Times, the facts currently known about the breach include:
Samsung Pay launched just weeks after the breach was discovered, and before a full investigation could be completed. While Samsung states its enterprise IT was not compromised, it is not known when—or if—the extent of the LoopPay breach will be known or disclosed.
The competition for supremacy in smartphones and cashless transactions is intense. In mobile payments, a slight edge could mean a significant windfall for Apple, Android, or Samsung. By the same token, loss of consumer confidence through a data breach could prove very costly.
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