NEW YORK -- The numbers are chilling: ATMs on bank property are under heavy and escalating attack by organized criminals who are ever smarter and slicker. What that means is that every time you stick a debit card into an ATM slot you just may be giving your information to a crook who has inserted a "skimmer" that gathers your card data. The crook then prints out a fake card with your data. Usually PINs are also collected via tiny pinhole cameras.
Credit reporting group FICO has reported that attacks on ATMs on bank property jumped 174 percent year on year in the first part of 2015. Attacks on non bank machines jumped 315 percent in the same period.
Matters are so grave that leading ATM-maker NCR on July 23 issued an alert to its customers that said, "NCR is tracking an increasing frequency of card skimming attacks in both the U.S. and in Mexico."
An NCR spokesperson said that direct losses globally due to ATM skimming is $3 billion.
It gets worse. Until recently many skimmers were crude and attached directly on top of the ATM card slot. For them, the usual self defense prescription has been to shake the slot. If something comes off in your hand it's probably a skimmer. No more. Owen Wild, an NCR expert, said that NCR is seeing more skimmers that are inserted down into the card slot and thus are invisible on the exterior. There also is a rising incidence of cases where a criminal drills a hole into an ATM, inserts a copying device, then covers the hole with a decal. Wild said many of these devices are slick enough that they defeat some anti-skimming technologies in use on ATMs.
By now you want to know what your liability is.
The news is mixed. On paper you have little to no liability. The Federal Trade Commission says losses are capped at $50 if the loss is reported within two days of learning of it. The cap is $500 if reported within 60 days. More than 60 and the losses are unlimited.
But it gets worse. Several victims of ATM fraud have told TheStreet that their bank refused to restore any monies, insisting the victim must have given the crook his card and PIN. Remember: the crook has a card with the right data and the PIN, so it looks like the accountholder is withdrawing cash. Who knows the real facts in these cases -- just don't assume all will be well with ATM theft because it isn't always.
In just about all cases, too, there are delays -- often short, occasionally long -- in restoring money taken from an account. With a bogus credit card charge, it's put in suspense the instant it is challenged. With a debit card, real money has to be restored to the account and while that is happening, rent checks may bounce, car payments may be late and more mayhem may befall the victim. It isn't pretty.
The best defense: don't become a victim.
So, why is ATM skimming sharply jumping? "The ability to buy pre-assembled or programmed skimmers have turned what was once a complicated scam, into something that the average Joe could do if he's willing to pay for it," said Luis A. Chapetti, software engineer and data scientist at Barracuda. Chapetti also provided a URL where many skimmers are for sale, generally at prices of $1,000 and up.
Snag just two or four cards and the skimmer paid for itself. The rest is gravy.
This availability of off-the-shelf skimmers is key to the epidemic. Before a crook needed some fabrication skills and tools. No more. Ready cash buys the gear, so any klutz can become an ATM crook. It won't stop soon, either. Experts anticipate a sustained attack on ATMs, because they are where the money is.
How can consumers protect themselves?
"Shield the [ATM] pad from prying cameras as you enter your PIN, and regularly check your account for evidence of fraud," said Steven Weisman, a lawyer in Amherst, Massachusetts, who frequently writes about scams. The first part is crucial: cover your actions with your other hand as you enter the PIN. That probably will thwart the crook's attempt to grab the PIN and, by doing that, you have dramatically reduced -- maybe eliminated -- this card's usefulness.
As for checking your account -- and setting up account activity alerts -- that's key to minimizing your actual losses. The sooner you notify the bank, the lower your losses generally will be.
Do just those two things and, probably, you'll be fine -- even if the ATM crooks keep redoubling their efforts which is what some experts gloomily expect.
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