Fraudulent insurance transactions transferring to new account

quikkie_2

My Nationwide credit card details were compromised last month, with a number of fraudulent online transactions made to various car insurance companies (not sure how anybody could make money from this, but hey!). After reporting the fraud to Nationwide, they cancelled the account and sent through a new credit card in the post - all normal procedure.

Yesterday I noticed some suspicious transactions in my new account - for 2 of the same car insurance companies that had featured the first time around. Figuring my details had been compromised again, I called Nationwide to get the card blocked.

Here's where it gets interesting - they thought my new account was safe, and that the insurance companies had been made aware of my new account details through some kind of legitimate "subscription process" (their words). They likened it to moving direct debits from one current account to another, making it easy to transfer payments to new accounts. In this case it's obviously exactly what I didn't want!

Has anybody ever heard of this happening with credit cards before?

grumbler

Continuous Payment Authority has always been a PITA, and changing the card never stopped it:
Continuous payment authority: recurring payments

Things have changed recently, but you still have to ask the bank for refunds as they are often incapable of stopping the transactions:
Bank failed to cancel regular payment? Claim - Money

rizla_king

Probably something like the Visa Account Updater Service?

http://www.visaeurope.com/en/cardholders/pay_regularly.aspx

Visa Account Updater service (VAU)

For Visa cardholders in Greece, Ireland, Italy and the UK there is another bonus to making regular payments on Visa.

Visa banks use the VAU to ensure that selected regular payment suppliers have the most up-to-date card details before they attempt to bill your card.

This means that if your Visa card is lost, stolen or upgraded, selected suppliers can continue to provide your goods or services without interruption.

! Important information

No personal information is stored on the Visa Account Updater
Card details are only available to Visa member banks and selected regular payment suppliers
Card details are not used for any other purpose
Only merchants with whom you have set up a recurring payment can receive updates if they subscribe to the service

In other words, if the insurance company thinks the transactions are legitimate then they can get them transferred to your new card.