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8/20/2015 | By Team United
Recent news from southwest Michigan, Mexico and Europe has brought the dangers of ATM skimming back into focus for many financial institutions and their customers. According to ATM Marketplace, criminal organizations have ramped up their sophistication and global reach resulting in more than $2 billion in losses (and rising) at ATMs around the world. This article will give you a better understanding about the risks of ATM skimming and ways to work with your financial institution if you believe you have been a victim of a skimming attack.
The FBI describes ATM skimming as the illegal installation of a device on an ATM that secretly records bank account data when the user inserts an ATM card into the machine. Criminals collect the data onto a blank card and use the information to steal from the customer’s bank account. The graphic below provides additional information into how the scam works.
Photo courtesy of the FBI.
Would you expect a rural Michigan town to be the target of a skimming attack? In the summer of 2015 skimming devices were discovered at gas pumps in the southwest Michigan town of Dowagiac. According to Moody on the Market, the Weights & Measures Division of the Michigan Department of Agriculture discovered the scam when several inspection team members working to resolve an issue over alleged contaminated gasoline found nothing wrong with the gas, but did find an odd bundle of wires connected to a miniature transmitter. State officials said this was the first time such illegal transmitters were found on Michigan gas pumps, and as a result state inspectors will now add a more detailed inspection behind pump panels to check for copy-cat activity.
Additional skimming attacks have originated in international tourist towns. In July, two ATM skimming devices were found in Puerto Vallarta, Mexico, a popular tourist destination. According to the blog Krebs on Security, municipal police in Puerto Vallarta arrested a man who had just replaced the battery in a pair of skimming devices he or an associate had installed at an ATM in a busy spot of the town. This skimming kit targeted certain models of cash machines made by Korean ATM manufacturer Hyosung, and included a card skimming device as well as a hidden camera to record the victim’s ATM card PIN.
A March 2015 report from the European ATM Security Team (EAST) found the trend of skimming-related losses occurring in countries that have not fully implemented the use of debit and credit cards with EMV chip technology continue to rise. The U.S. remains the top location for these losses with Thailand and Indonesia as the No. 2 and No. 3 targets, respectively.
The EMV technology, available soon for United credit and debit cards, encrypts your personal data within a small chip on the card. The chip generates a unique transition code every time a purchase is made. Since this number changes with each transaction, the information skimmed would be useless to a criminal. While EMV should nearly eliminate the amount of fraud via a skimming device, it is important to note that fraudsters are constantly trying to find ways to stay ahead of the game.
Many times the skimming device itself is very hard to see. The fraudsters usually make replica parts that look normal to the average user. Below is a photo of the ATM used in the Puerto Vallarta scam. Would you be able to spot the skimming device?
According to the Krebs on Security article, the tiny pinhole camera was hidden in a molded plastic fascia designed to fit over top of the area directly above the PIN pad. The only clue that something is wrong here is a gap of about one millimeter between the skimming device and the actual ATM.
United Federal Credit Union uses anti-skimming device readers on all of the ATMs in our fleet. The anti-skimming mechanism is equipped with technology that puts the machine out of service as soon as it detects a foreign device or if the fascia is forcefully removed. Newer card readers allow users to insert their card with the long edge first which renders a skimming device useless. United staff members also visually inspect each ATM every day for any suspicious devices.
The most effective way to protect yourself against skimming or any other type of fraud is to closely monitor your accounts for suspicious activity.
If you believe your credit or debit card has been compromised, via skimming or any other means, you should contact your financial institution as soon as possible to report the fraudulent activity. At United Federal Credit Union, Members should contact our Member Service Center at (888) 982-1400. A United representative will work with you to resolve the situation to your satisfaction and issue you a new card.
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* No one can prevent all identity theft.