ATM Skimming – What You Should Know

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A Florida man was sentenced to federal prison following his role in an ATM-skimming case. He was found guilty of aggravated identity theft and possession of ATM-skimming paraphernalia. In another case, an Atlanta man was sentenced to 38 months in prison on ATM skimming charges along with restitution of more than $70,000 upon his release.

In an even weirder case reported by Techworld, closed-circuit cameras caught a Romanian man fitting a skimming device into an ATM in the U.K. He was arrested when he returned to move the device. The man is accused of skimming 9,000 ATM PINs that would have allowed him to steal nearly £5 million from British victims. The ATM device recorded account numbers while a small camera captured PINs entered by unwitting victims.

The Art of Skimming

The skimmer, which looks nearly identical to the original card reader, is placed on top of the original card reader. As customers insert their ATM cards, their bank account information is skimmed by the card reader and stored on an electronic device. Identity theft protection company LifeLock reports that skimmers cost banks as much as $1 billion every year and the number of cases increased 10 percent per year from 2008 to 2010. Skimming is not unique to ATMs. Credit card readers are also susceptible to skimming, which means when you hand your card over to a cashier, you risk becoming a victim of identity theft. LifeLock reports that ATM and credit card skimmers combined cost U.S. banks $8 billion in a year.

Avoid Being Skimmed

Luckily there are ways customers can avoid being skimmed. ATM users can start by inspecting the specific ATM, gas pump, or credit card reader before using it, and looking out for anything loose, crooked, scratched, damaged, taped, or device that might be installed over the original card reader. An ATM user can block the keypad with her other hand while entering her PIN number in order to prevent possible “pinhole” hidden cameras from recording their numbers. It is also recommended that if possible, bank customers use inside ATMs, which are more difficult to install ATM skimmers.

Some banks offer prepaid Visa and Mastercard cards, which are not tied directly to bank accounts and function just like debit and credit cards. Users transfer money to the cards and use them to buy goods and services. Potential thieves would have access only to the amount on the card, rather than the victim’s entire financial information. If you go the pre-paid route, look for a vendor who offers low fees.

The Future of ATM Banking

The ATM Industry Association reported in 2012 that skimming is the biggest threat to ATM security. It surveyed 225 ATM vendors, and 53 percent of them reported an increase in skimming and other attacks, such as cash trapping (which does just that—uses adhesive to trap cash rather than dispense it) and using explosives to open machines.


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