Help Protect Your Customers from ATM Fraud

September 16, 2015

With the migration of payment cards to the safer EMV (Europay/MasterCard/Visa) chip, as well as heightened vigilance, ATM related fraud is down – but complacency is dangerous, and it's important to be informed and take precautions in order to discourage ATM fraudsters.

How do ATM fraudsters do it?
Criminals may target ATMs in remote, unmanned areas and pretend to use the machine while covertly planting a reader and camera. Once the reader is in place, it can be difficult for the untrained eye to detect.

This mechanism is made up of intricate electronics that use a mag-stripe reader and a data storage device to hold the information until the criminal returns to collect it.

Once retrieved, the data captured is used to "clone" or duplicate existing cards while a camera, surreptitiously placed close to the ATM in a trash bin or envelope dispenser, will record the cardholder's PIN.

Recently, single collection devices with built-in cameras have also been used, but either method will give thieves everything they need to use cloned cards to defraud unsuspecting victims.

"When we investigate potential fraud, we rarely find obvious evidence of tampering, such as glue residue from attached cameras and card skimming devices or damaged control panel locks," says DC Payments National Operations Manager, Jeff Palinka.

When evidence is found that indicates fraudulent activity on DC Payments ATMs, the protocol is to immediately post a fraud alert to notify the police. From there, it might be necessary to reissue cards or to contact cardholders to review and confirm usage activity. DC Payments knows that fraud prevention is the best cure.

So what can you do?
The first step in combatting ATM fraud is to identify potential areas of vulnerability such as the card reader. For example, a card reader in one ATM might also be found in other ATM models. Having a common card reader makes it easier for criminals to quickly create card reader overlays that fit over card readers in many machines.

Palinka says that vigilance is key. "These data-capture devices are fairly well designed, but they aren't perfect," he says. "Someone who regularly services these machines can easily spot them; even regular users of the same machine can tell if they look closely. It's important to look for any foreign devices attached to the ATM and continually monitor activity around the machines you manage."

Today, ATM fraud is largely preventable, but, as with any other cash-based device or service, ATMs will always require some degree of protective monitoring. DC Payments can help ensure that you have the maximum protection against fraud.

For more information about preventing fraud, please contact your DC Payments representative by email or by phone at 1800 301 100.

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