It’s absolutely fascinating (in a nerve-wracking sort of way) to read about how many different ways there are to use ATMs to capture (and steal) accounts and PIN numbers. From there, it takes very little time to create a fraudulent card and spend what you can before the bank catches up. It’s a triumph of hardware over software. Thieves simply work around the software controls to capture the information they want.
For example, the concept of “skimming.” Typically, thieves attach a device to the outside of the ATM that records the magnetic stripe information as you insert it. They also need a camera of some sort to capture the PIN as you type it in. For a classic example, with pictures you can see that the card skimmer fits in front of the regular card slot. For PINs, the clever placement of a pinhole wireless camera makes it all way too easy.
Thieves tend to get endlessly creative: One fellow bought his own ATM equipment and kept moving it around from place to place in order to capture information. He was good enough at it to collect at least $4 million, and is still at large.
More losses come from retail ATMs (those found in supermarkets, convenience stores, gas stations, or other non-banking environments) where there are less stringent controls and only casual observers. In May of this year, the ATM at one gas station was rigged, with at least 80 victims. When he was finally apprended, he had stolen more than $185,000. Ouch.
There are about 360,000 ATMs in the United States, according to Bankrate.com Only half of them are at a bank.
The ATM designers are moving to internal card readers and other techniques to eliminate external skimming devices, but when you can buy your own ATM and move it around, controls on sales of such machines must be tightened.
Rule of Thumb: If I don’t go to the bank for gas, I won’t go to the gas station for money.