Don't Be Skimmer Scammed
Fraud involving credit, debit, and other payment cards costs retailers, financial institutions, and consumers billions of dollars a year. And the problem is only getting worse.
What to do about that scary statistic is the subject of “Skimming the Surface: How Skimmer Fraud Has Become a Global Epidemic,” a new report authored by Seidenberg Assistant Professor Darren R. Hayes, DPS, and sponsored by the Association of Chartered Certified Accountants USA.
Skimmer fraud involves the use of electronic devices, sometimes concealed in ATM card slots, to “skim” data from payment cards, which is then used to loot those accounts. “This is a war being fought at the ATM and the gas pump, at the intersection of street crime and tech crime,” said Warner Johnston, head of ACCA USA, in statement accompanying Hayes’s report. “As criminals become more sophisticated, they are devising creative ways to separate consumers from their cash.”
Hayes conducted his research over a 15-month period, traveling throughout the U.S. and Europe, where much of the crime originates. He interviewed experts in law enforcement, financial services, and the payment card industry.
His report, available online, lays out a number of steps that industry and government can take to prevent, or at least reduce, skimmer fraud.
We asked him what individual consumers can do to protect themselves. Among his suggestions:
- Cover the keypad when entering your PIN at an ATM to avoid prying eyes and hidden cameras.
- Wiggle the card dip reader. If it’s loose, it may have been tampered with.
- Ask your credit card issuers to send you new cards with an embedded global chip (an EMV card); it will limit fraud at some terminals.
- Put a free fraud alert on your file at one of the three major credit agencies (Equifax, Experian, and TransUnion). The alert will automatically go to the other two agencies and make it difficult for anyone other than you to open an account in your name.
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