Hidden devices steal bank information that criminals use to make online purchases, sell to others
Last week, when Wesley Kennan went to make a lunchtime withdrawal from the ATM at a BB&T branch in Rock Hill, he made an alarming discovery.
After swiping his card, he gave a “gentle” pull on the card reader. Kennan said he sometimes does that when using ATMs to look for so-called skimming devices installed by criminals to steal card information.
To his surprise, the reader slipped right off. Kennan called Rock Hill police, who are now investigating.
“In today’s world,” he said, “you have to be vigilant.”
Skimming, which typically targets ATMs and gas pumps, is on the rise in the Charlotte metropolitan area, according to the U.S. Secret Service, which says it is the most common type of cybercrime in the region. Just four months ago, SunTrust Banks said devices designed to steal card information were found on some of its automated teller machines in the Charlotte area.
Since October, the agency says it has investigated 11 skimming incidents involving more than nine suspects, in a region spanning from Greensboro to Asheville. Most of the cases have been in Charlotte.
That’s more than double the four incidents involving three suspects during the 12 months prior to October.
According to the Secret Service, the growth in ATM skimming in the region is largely driven by Eastern European criminal groups. In one such case, federal criminal charges were filed last year by the U.S. attorney for the Middle District of North Carolina against four men accused of using a Concord hotel as a base of operations for their skimming scheme. The men spoke Serbian, according to court documents.
Concord and Charlotte-Mecklenburg police detectives who searched the men’s hotel rooms found skimming devices and the tools to make them, according to the documents. Three of the men have pleaded guilty. The fourth has pleaded not guilty.
Glen Kessler, a special agent with Secret Service’s Charlotte office, said Charlotte is among major U.S. metropolitan areas that are prime targets for Eastern European criminal groups who want easy access to ATMs near interstates.
The interstates that criss-cross Charlotte allow criminals to “hit a number of cities on their way through Charlotte,” he said.
Black Market Demand
In general, skimming involves criminals placing devices on ATMs to steal account data when consumers slip their debit or credit cards into the card reader. Tiny cameras or fraudulent keypad overlays installed by criminals on the ATM can be used to capture PINs.
Criminals can use the stolen information to make online purchases or to reprogram a gift card or other cards with magnetic stripes on the back that can then be used to make purchases in stores.
Skimming equipment itself is becoming more advanced, experts say. In some cases, criminals are using wireless technology to download stolen card data, eliminating the need for them to retrieve the equipment from the ATM.
It’s also getting easier for criminals to purchase the gear they need – and learn how to use it – online.
“You can buy skimming equipment on eBay and a number of other sites,” Kessler said. Videos on YouTube offer instruction on how to install the equipment, he said.
Criminals are setting their sights on ATMs at a time when some banks are rolling out more of the machines as fewer customers are entering branches to conduct basic transactions. Rising ATM use also means criminals can capture data on more consumers.
Cybercrime overall is a growing concern for corporate America and the federal government, with attacks by hackers continuing to make national headlines.
ATM fraud, which is part of that trend, is being driven in part by black market demand for stolen consumer data, said Avivah Litan, a fraud analyst for Connecticut-based Gartner Research.
“When there’s all these market places to sell the data to … you can turn the stolen data into cash more quickly,” she said.
What Banks are Doing
Banks, in general, are reluctant to talk about their specific efforts to improve cybersecurity.
Doug Johnson, the American Bankers Association’s senior vice president of payments and cybersecurity policy, said there is a variety of anti-skimming technology that banks are using. But cost is a concern.
“It would be unrealistic, potentially, to put that on every machine, because of the fact that there’s a level of expense involved,” he said. “I do see that institutions are deploying greater numbers of anti-skimming devices over time.”
An ATM’s location and customer traffic volume are often deciding factors in whether banks equip them with anti-skimming technology, including those that can detect if a skimming device has been placed on an ATM, he said.
Not all ATMs are owned or operated by banks. For example, ATMs at convenience stores are typically owned by independent companies. Johnson said it would be up to those companies to decide whether to outfit their ATMs with anti-skimming technology.
Johnson said his association is expanding a database to alert banks about skimming incidents that happened near their branches.
Litan, the fraud analyst, said even if banks take steps to better protect their ATMs, “there’s always new ways for the criminals to get on top of it.”
‘I’m Just Angry’
Kennan, the BB&T customer who discovered the skimming device in Rock Hill, said he doesn’t blame BB&T for what happened. “I’m just angry that somebody was trying to take advantage of me,” he said.
In a statement, BB&T spokesman David White said the Winston-Salem lender uses “sophisticated layered fraud tools” to monitor accounts and takes “every appropriate action to protect our clients from fraud.” BB&T is cooperating with local authorities, he said.
Kennan said he will continue checking ATMs he uses for skimming equipment.
“I’m not going to stay away from ATMs,” he said. “But I bet you I won’t miss tugging on one from now on.”
How to protect yourself
The Secret Service offers the following tips to help consumers avoid becoming a victim of skimming at ATMs:
• Stay away from ATMs that appear to have been altered. If anything on the front looks crooked, loose or damaged, it could be a sign that someone has attached a skimming device or camera.
• Tug on the card-entry slot and keypad to see if they are loose or if there are any protrusions that seem out of place. They could be an indication of a skimmer or card reader that’s been placed in/on top of the authentic device.
• As you key in your PIN, cover the keypad with your other hand to block anyone, or a camera, from viewing the numbers you type.
• It’s always safer to use a known ATM in a secure location. Deon Roberts
Staff writer Jonathan McFadden contributed.
The East Charlotte Area Patrol 