ATM Fraud – An Internal Viewpoint
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.