Defined as the intentional act of trickery to unlawfully obtain funds from an ATM, most people associate ATM fraud with external crime, where the card or card number and associated PIN are illegally obtained by outside individuals, gangs, or even more sophisticated organized crime syndicates. Considered a form of identity theft by the Federal Trade Commission (FTC), while identity theft had been holding relatively steady for the last few years, the FTC cites a 20 percent increase in ATM fraud in 2011 alone.

From the onset of the proliferation in the use of ATMs, less sophisticated (but equally effective) methods of ATM fraud include such means as card trapping, skimming, and keypad overlays.  Trapping, as the name implies, is where the customer’s card is somehow trapped by the perpetrator only to be retrieved later. Skimming is where the perpetrator has put a device over the card slot of an ATM, which reads the magnetic strip as the user unknowingly passes his card through it.  These devices require the use of a miniature camera (inconspicuously attached to the ATM) to read the user’s PIN at the same time.

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In movies and television it’s easy to spot the criminals.  In real life, and particularly when it comes to fraud, this is not the case.  In occupational fraud, it’s especially difficult because the crimes are committed by people you have entrusted to represent your organization.  These are people you know and trust; not masked characters lurking in the shadows.

Despite this, there are a number of commonalities among fraudsters, and specific trends in their crimes.  Awareness of demographic information and the behavioral trends surrounding fraud perpetrators is a crucial component of uncovering occupational fraud, which has grown into a potential $3.5 trillion a year global crime.  … Continue reading