By Stephanie K. Mann, J.D.
Automated teller machine card skimming fraud is increasing, and banks need to ramp up their detection and prevention efforts in response, according to the Massachusetts Division of Banks. A letter from Commissioner David J. Cotney is warning ATM operators to increase their security at their ATMs and to enhance their security programs.
Skimming is the use of a physical device that is somehow attached to an ATM, enabling a criminal to record the information on a card’s magnetic strip or to intercept information being transmitted over the ATM’s telephone or Internet connection. Alternatively, criminals may be able to capture the information wirelessly. The intercepted information can be combined with a PIN that was captured using a hidden camera to allow criminals to carry out fraudulent transactions.
The state regulator is encouraging ATM operators to increase their monitoring, both by enhancing physical security and watching more closely for unusual transaction activity. Physical and technological controls and incident response plans all should be tested regularly. ATM security considerations should be part of financial institution risk assessments, the division also says.
Warning to consumers. Additionally, the Division advised consumers to examine nearby objects that might conceal a camera and to check the card slot for a plastic sheath before using an ATM. Consumers should leave an ATM if they notice someone is watching and to immediately report any suspicions to the machine operator or a nearby law enforcement officer.
The Division further cautioned consumers not to respond to unsolicited requests for bank account numbers or PINs for debit or ATM cards. Consumers should additionally monitor accounts for unauthorized transactions and immediately contact their financial institution if fraud is suspected.
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