Cambridge researchers have discovered a way to carry out transactions without needing to know a card’s pin. A stolen card reader sits in an off-the-shelf card reader, inside a backpack and controlled from a laptop, which slots into the actual shop terminal. The Cambridge team is already working on miniaturising it all into a unit the size of a remote control. The attack is called a “man in the middle” attack because the software is tricking the terminal into thinking the pin has been verified.”]
Source: https://www.bbc.co.uk/blogs/newsnight/susanwatts/2010/02/new_flaws_in_chip_and_pin_syst.html