Samsung has insisted that its newly launched mobile payments system is unaffected after the technology on which it is based, called LoopPay, was hacked.
American payments startup LoopPay, bought by Samsung in February to underpin the company’s Samsung Pay mobile payments system, was attacked by a Chinese group of hackers according to a report by the New York Times.
The hackers, known as the Codoso Group or Sunshock Group, had access to LoopPay’s internal network since March and went undetected until August, according to the report.
Samsung said: “Samsung Pay was not impacted and at no point was any personal payment information at risk. This was an isolated incident that targeted the LoopPay office network, which is a physically separate network from Samsung Pay.”
Samsung Pay was launched in the US on 28 September, in full knowledge of the hack and allowing the manufacturer’s latest Galaxy S6 and Note 5 devices to be used to pay for goods and services.
The differentiating factor over Apple Pay and Google’s Android Pay systems is that the service is underpinned by LoopPay, which can simulate a magnetic card swipe allowing users to pay for goods and services without the merchant requiring an NFC-enabled till.
The hackers had undetected access to LoopPay’s corporate network for five months, which Samsung says “handles email, file servers and printing”. How much of the information required to replicate the technology was stolen from the company in that time is unknown at this stage.
The reinvigoration of mobile payments by Google, Apple and Samsung is seen as a way to further lock users into the manufacturer’s ecosystem and provide an additional revenue stream.
Apple Pay launched in the UK in July, following an October 2014 release in the US. Google’s Android Pay launched in the US in September replacing the company’s previous mobile payment system called Google Wallet. A release within Europe is expected within the next year, while Samsung Pay – which uses the company’s Android devices – is a separate system and is also expected to be released within the next year in Europe.
