Vigilance and fast action can help deter ATM skimming fraud

Fraudsters have been busy “skimming” ATMs since at least the last holiday season, as fraudsters have sought to take advantage of magstripe readers before adoption of more-secure EMV chip card-compatible ATMs becomes widespread.

Skimming refers to fraudsters using a device to steal credit or debit card information in an otherwise legitimate card transaction. Skimming devices are often placed on ATMs. When a card is run through a skimmer, the device stores the information. Thieves then use the stolen data to make fraudulent charges either online or with a counterfeit credit card.

The ATM fraud resulting from these skimming incidents is often local to the cardholder’s residence and is known as “footprint fraud.” As fraud is perpetrated where a cardholder might normally frequent, illegitimate transactions become harder to detect.

For example, a case study prepared by CO-OP Financial Services reported on a card skimming scam discovered by Elevations Credit Union in Boulder, Colorado. In this case, all of the skimming took place at the same local supermarket. A few days later, the thieves used the information skimmed from the store’s self-checkout units to steal money with fraudulent cards from ATMs within the same several block area in nearby Denver.

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