Single Swipe

Dramatic Reduction of Card Present Fraud: MagnePrint Risk ManagementDetail of MagnePrint Flow

When strong encryption and secure tokenization are used in conjunction with dynamic card authentication, it provides a solution that can protect cardholder data while at rest or in transit and exceeds PCI DSS requirements. It further secures payment systems with real-time information to prevent, detect and alert to the presence of fraudulent transactions and rogue devices.

Clear text card data (unencrypted)

Transactional MagnePrint

3DES/DUKPT Encrypted Card Data

MagnePrint Score

Topology Key

(SCRA) Secure Card Reader Authenticator reads ISO/AAMVA encoded surface layer data, reads the magnetic particulate layer below, encrypts the data within the tamper resistant authentication sensor and transmits the encrypted cardholder data along with the stripe’sdynamic digital identifiers (DI) for card and cardholder data authentication during the transaction authorization process. ONLY MagneSafe secured devices fit this description.

Magensa Page 2

0.Card data “in-the-clear” encoded,printed & embossed on card.MagnePrint already present.

POS Host MagensaStore Controller

The card data is protected immediately with 3DES/ DUKPT encryption at the point of swipe.Transaction MagnePrint generated and embedded in ISO 8583 message with necessary transaction details.

Card swiped in SCRA at POS and sent to the Store Controller1.

Data is protected at POS, branch network, store controller, and external communica-tions via encryption & session IDs

Magensa decrypts card data

2.

Magensa scores the Transaction MagnePrint against the Reference MagnePrint

3.

Magensa returns the score to the Host

4.Host perfoms riskassessment and management5.

Host determines if score is high enough

6.

If NO: Automated “Fraud Alerts” can be sent to the POSNo

If YES: transaction details are sent to the processorYes

Processor sends transactiondetails out for authorization

7.

;522145368John Public

Card Data

Transaction MagnePrint Standard ISO 8583 Message

Shared and Accessible Fraud Information Database

Brand ProcessorGateway

MagnePrint Reference Capture

Reference MagnePrint

Transaction MangePrint

0101001

0101001

MagneScoreHOST

When strong encryption and secure tokenization are used in conjunction with dynamic card authentication, it provides a solution that can protect cardholder data while at rest or in transit and exceeds PCI DSS requirements. It further secures payment systems with real-time information to prevent, detect and alert to the presence of fraudulent transactions and rogue devices.

Clear text card data (unencrypted)

Transactional MagnePrint

Tokenized and/or Masked Data

3DES/DUKPT Encrypted Card Data

Transaction details

MagnePrint Score

Topology Key

(SCRA) Secure Card Reader Authenticator reads ISO/AAMVA encoded surface layer data, reads the magnetic particulate layer below, encrypts the data within the tamper resistant authentication sensor and transmits the encrypted cardholder data along with the stripe’sdynamic digital identifiers (DI) for card and cardholder data authentication during the transaction authorization process. ONLY MagneSafe secured devices fit this description.

Dramatic Reduction of Card Present Fraud: MagnePrint Risk ManagementMagnePrint® in the Payment Flow

Magensa Page 3

0.Card data “in-the-clear” encoded,printed & embossed on card.MagnePrint already present.

POS Host MagensaStore Controller

Processor IssuerBrand

The card data is protected immediately with 3DES/ DUKPT encryption at the point of swipe.Transaction MagnePrint generated and embedded in ISO 8583 message with necessary transaction details.

Card swiped in SCRA at POS and sent to the Store Controller1.

Data is protected at POS, branch network, store controller, and external communica-tions via encryption & session IDs

Magensa decrypts card data

2.

Magensa scores the Transaction MagnePrint against the Reference MagnePrint

3.

Magensa returns the score to the Host

4.Host perfoms riskassessment and management5.

Host determines if score is high enough

6.

If NO: Automated “Fraud Alerts” can be sent to the POSNo

If YES: transaction details are sent to the processorYes

Processor sends transactiondetails out for authorization

7.

Processor sendsdetails to Host

8.

Host forwards details onto Store Controller

9.

Transaction is completed

10.

;522145368John Public

$104.23

Card Data

Transaction MagnePrint

TransactionDetails

Standard ISO 8583 Message

Single Swipe

ATM•Card Personalization & Issuance•Teller Window •POS•Remote Deposit Capture•Mobile•Internet Banking•Law Enforcement

Alcohol, Tobacco & Firearms•Dept of Motor Vehicles •Election•Legislative Regulations•Social Security•Remote Access•Law Enforcement

POS•Store Controller•Merchant Host•Processor Gateway•Acquirer•Brand Switch•Issuer•Law Enforcement

Content & Delivery•Facilities Access Control•Forms Management•IP Property•New Hire ID•User Identity •Remote Access•Law Enforcement

Shared and accessible fraud information database, cross-industry collective dataMANAGEMENT & AUTHENTICATION OF: Cards, Keys, Users, Hosts, Tokens, Devices.Exceeds FFIEC recommendations and PCI DSS compliance.

Financial

Government

Enterprise

Retail

Global MagnePrint® Exchange

eCommerce•Banking and financial institutions•eProcurement •Cloud-based services•Gaming•Marketplace services•mCommerce•Merchants•Pharmacy and Healthcare•Service providers•Social Networks/Dating•Law Enforcement

Reference MagnePrint

Transaction MangePrint

0101001

0101001

MagneScoreHOST

simply stops fraud

simply stops fraud

Magensa™ is a fraud prevention, detection and advisory service. It

maintains a globally accessible registry of authentication information

so that consumers, financial institutions, retailers, businesses and

governments can assess the validity and trustworthiness of the

credentials and products they rely upon in the course of online

identification, payment, and other important transactions.

Additionally, Magensa provides token management and cryptographic

services, vital to the protection of cardholder data, the payment

system, and personal or sensitive information. Magensa is a

subsidiary of MagTek, Inc.

Magensa I 1710 Apollo Court, Seal Beach, CA 90740 I 562-546-6500 I info@magensa.net

© Copyright 2012 Magensa All rights reserved. PN 99810007 Rev 2.02 2/12

Dramatic Reduction of Card Present FraudMagnePrint® Risk Management

How Do Magensa and MagnePrint Work?

Capture the Reference MagnePrint MagTek makes readers that recover the encoded track data and the MagnePrint simultaneously. The MagnePrint is converted to a 54 byte digital string. When the card is first issued or first used, the Processor or Card Issuer stores the digitized original MagnePrint at Magensa. This is information is designated as the Reference MagnePrint.

Encrypt the Card Data and Capture the Transaction MagnePrintMagTek makes a variety of readers suitable for use in ATMs, gas pumps, PDAs, kiosks,PCs, vending machines, MACs, cell phones, ECRs and POS terminals. When a card isread, the encoded card data, the MagnePrint and the usual transaction details are3DES/DUKPT encrypted and sent to the Card Issuer for verification. The MagnePrintobtained at this time is designated the Transaction MagnePrint.

Verify the Transaction MagnePrintTransaction MagnePrints have a remarkable and valuable feature. They change stochastically – that is they change dynamically, but in ways that can’t be predicted with any certainty. The change is a matter of probability, built in by the imperfection of nature. The odds of obtaining two identical 54 byte Transaction MagnePrints from a single card are about 1 in 100 million. A Transaction MagnePrint identical to one previously used will be rejected. This inherent variability of Transaction MagnePrints provides an algorithmically verifiable, unique transaction number for every card swipe.

Score the Transaction MagnePrint against the Reference MagnePrintMagensa receives a Transaction MagnePrint, compares it to the Reference MagnePrintand calculates a score based on the correlation between the two. A high score indicatesa legitimate card. A low score points to a counterfeit card. The Card Issuer sets theminimum passing score and uses the MagnePrint Score as part of the transactionaccept/decline criteria. MagnePrint scoring is a fast “real-time” process. Typical scoringtimes are 10 milliseconds or less.

$

3DES/DUKPTEncryptedCard Data

Transaction MagnePrint

; 52 2145368JOHN DOE

$ 104.23

To host

Transaction Details

54 bytetransaction MagnePrint

Same card swiped3 times on thesame reader

1 0 1 0 1 1 1

1 1 0 0 1 0 1

0 1 0 1 0 0 1

1st swipePrevious use:

2nd swipePrevious use:

3rd swipePrevious use:

HO

ST

Yes No

Yes No

Yes No

Tran

sact

ion

Mag

nePr

int

Host

Score

Transaction MagnePrint

Reference MagnePrint

0 1 0 1 0 0 1

0.978

0 1 0 1 0 0 1

MagneScore

Card Data

Single sw ipe

Reference MagnePrint

Initial issue or rst use of card

When a card-present transaction is submitted, the MagnePrint of the card read at thetransaction point is transmitted along with the encrypted card data. At Magensa,the MagnePrint risk management tool compares the ‘transaction MagnePrint value’ to a‘reference MagnePrint value’ already present in the authorization database. Thesereference values are currently submitted by Processors, but ideally they will also comefrom Issuers or any other party above that has access to Magensa.

Access to MagensaMagnePrint Reference Data

Magensa Page 4

Dramatic Reduction of Card Present FraudMagnePrint Risk Management

simply stops fraud

simply stops fraud