ATM fraud is a major problem worldwide, with fraudulent deposits and skimming of card information being common. Criminals use various methods, including implanting devices on ATMs, using cameras, and card skimmers to steal information and withdraw funds. Financial institutions and cardholders are most concerned about these types of fraud.
Financial fraud of all kinds is a huge problem around the world. With the advent of ATMs, or ATMs, has come another opportunity for would-be thieves to steal money, account information, and identities. The term “ATM fraud” can refer to an illegal transaction committed using an ATM, including fraudulent deposits or skimming of card information.
Most financial institutions have made depositing checks or cash as easy as withdrawing funds from an ATM. Most financial institutions also operate on the assumption that the person making the deposit is honest and is actually depositing a valid check or cash. As a result, most ATMs credit the account holder with at least a portion of the deposit immediately upon completion of the transaction. This can make ATM fraud very easy for someone who deposits a blank envelope and then withdraws money from the account. Of course, the amount that can be withdrawn using this type of ATM fraud is limited, and tracing the transaction is fairly simple, making fraudulent deposits less of a concern than other types of ATM fraud.
Much more concerning to financial institutions and cardholders are the various forms of ATM fraud committed by stealing or skimming a cardholder’s information when they use the ATM. Theft of a cardholder’s information can be accomplished in a number of ways. A criminal can implant a device on the ATM that makes the card appear to be locked in the machine only to be retrieved minutes later by the thief when the cardholder becomes frustrated and leaves the area. The thief can then simply initiate another card transaction and withdraw money from the account.
Criminals have also been known to use cameras placed near an ATM that read card information and record the pin number as it is entered by the cardholder. A clone, or duplicate, of the card is then made and used by the thief to make purchases or withdraw funds. This type of ATM fraud, however, has largely been replaced by more advanced gadgets known as card “skimmers.”
A card skimmer is a device placed on the ATM that is unrecognizable by most users of the machine. The device actually reads and records card information, as well as the pin number entered by the cardholder, in some cases. The thief simply goes back to the ATM later and removes the device and then uses the gathered information to create cloned cards.
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