This article appeared in the ATM & Financial Self-Service Executive Summary, Spring 2006.
Security is a growing concern for financial institutions. But experts in the field argue that high-tech hacks aren't causing FIs the most headaches.
Andreas Pollklaesener, a banking division security specialist for Paderborn, Germany-based Wincor Nixdorf International GmbH, said skimming is the No. 1 ATM security concern for most parts of the world, including North America.
"The easiest way to collect card data is by using skimming devices," Pollklaesener said. "We focus on the card-reader, because we see that as the most important side."
By quickly detecting anything that is attached to an ATM, an FI can take immediate action such as taking the ATM off line or dispatching law enforcement.
Philosophies differ when it comes to card-reader protection, however. Manufacturers are cranking out ATMs with everything from radio-frequency detection and minicameras to sensors and jitter.
But Pollklaesener argues that even radio-frequency and jitter, which varies the speed and intermittently reverses the direction of the magnetic-stripe read, have their weaknesses.
"We have the jitter function available, but we see no benefit to using that," he said. "Jitter is a security feature, but it helps only for simple skimmers. With motorized skimmers or extended skimmers, only a sensory solution will offer protection," because mag-stripe data still can be read.
"With the sensor, if there is a permanent change on a certain level, within three minutes we can get an event to the application."
A case for North America
In Canada, like most countries, skimming is the No. 1 ATM crime. Canadians are the highest per capita users of ATMs in the world, so maintaining consumer confidence has been a focus for Quebec's largest FI, Montreal-based Mouvement des caisses Desjardins (Desjardins Group).
"Our ATM users want accessibility, simplicity and security," said Jean-François Mérette, Desjardins' manager of ATM and POS access.
In 2004, Desjardins began deploying Wincor's ProCash 2100s. The ATMs include Wincor's sensors that check the entire area around the card reader. The security module is mounted in the ATM and isn't externally visible.
"Skimming attacks have gathered pace in recent years in Canada, and ATMs are being manipulated more often through the use of devices attached to their card slots," said Lindsay Hunt, a self-service executive at IBM Canada, a Wincor partner since 1999. "The anti-skimming module provides effective protection against fraudulent manipulation of ATMs."
Desjardins, the first Canadian FI to use Wincor's anti-skimming feature, decided to replace its fleet as it upped security and moved toward more automated transactions.In the future Desjardins can upgrade any of the Wincor ATMs to deposit automation and check-imaging. But Wincor's Pollklaesener said most North American ATMs can be upgraded to include sensory solutions.