It's hard to discourage a determined criminal, especially if they know a large amount of money is at stake -- as in many ATMs.

"We keep making the safes bigger and stronger," said Andrea Carozzi, a product manager at Wincor Nixdorf, "but they just keep getting more dynamite."

Blasted safes have been a particular security problem in Sweden, where Carozzi said criminals have ready access to dynamite and knowledge of how to use it because of its widespread use in the construction industry there.

Sixty ATM vaults were hit in explosions in Sweden in 2000, he said. Even worse, the explosions caused a great deal of "collateral damage" to bank branches where the ATMs were located, in some cases leaving gaping holes in buildings.
Story continues below...

Engage Customers with Strategic ATM Marketing
So, you’ve taken the plunge and launched one or more targeted offers at the ATM.  But, are you getting those 20% take-up rates you were hoping for?  Phoenix customers are. Find out five ways to drive more revenue with ATM marketing.

Wincor Nixdorf decided to try a different approach and in 2001 teamed with Security Qube System (SQS), a Swedish manufacturer of systems used to secure money, weapons and other valuable goods during transport. SQS' products for ATMs -- which include Q-case, a suitcase-sized carrying case for cash-in-transit workers, and Qcut cash cassettes for use inside the machine -- use dye as a deterrent, staining money so that its value to criminals is minimized.

"That way you can use a weaker safe, one they can open with no damage to the surrounding building. But you take away their incentive because they can't spend the money," Carozzi said.

Am I blue?

Wincor adopted the same technology used in SQS' Q-Cases, which are used to protect loaded ATM cassettes during transport, to create a special vault for its top-selling ATM, the ProCash 2150. A dozen ATMs, all owned by Swedish banks, are currently equipped with the vault -- which Wincor calls the Blue Safe because of its distinctive cobalt hue.

Hopefully the bright color will be an added theft deterrent, Carozzi said. "We want them to know that blue means the money is no good."

If the safe's security is compromised, Carozzi said, sensors detect it and a small explosive charge "similar to an airbag in a car" releases the dye, which is located inside cash cassettes.

Wincor intends to tweak the technology so it can be offered as an upgrade to its existing ATMs in other European markets such as Belgium, the Netherlands and the UK, according to Thomas Wethmar, another Wincor product manager.

"In those markets we will offer an end-to-end security solution based on SQS Q-Case, electronic QCut cassette and special electronics for conventional safes," Wethmar said.

SQS has customers throughout Scandinavia, as well as in the UK, Germany, France, the Netherlands and Italy, he said.

Don't give up your dye job

Wincor is not the only ATM manufacturer promoting the cash staining concept. After several years of working together, NCR in 2001 purchased the ATM-related business of a UK-based company called Spinnaker International. Now a wholly owned subsidiary and renamed Fluiditi, it offers both the Sentinel, a system that protects cash inside an ATM vault, and Genesis, to protect cash during transport, both in an armored van and across the pavement.

The two systems ideally are used together but can also be used separately, said Christophe Primault, Fluiditi's managing director. They are sold both by a dedicated Fluiditi sales force and NCR account representatives.

The company's products are used by a dozen financial institutions in the UK, Norway, the Netherlands and France, said Primault, who served as global marketing manager of NCR's Financial Solutions division until his move last month to Fluiditi.

Primault said that interest in Europe has grown since last year's adoption of the euro, which makes it easier for thieves to transport stolen cash across borders. He expects an even greater uptake as more off-premises ATMs are deployed across the Continent.

A major difference between Fluiditi's products and those of competitors, said Primault, is that the ATM will shut down if dye is released, so that no stained notes are inadvertently dispensed to the public.

The other primary difference is that the dye is not located inside cash cassettes. Instead it is stored in canisters, which are connected to the cassettes during transport, again while they are carried across the pavement, and in the ATM itself. If security is breached, the dye is propelled into the cassettes by carbon dioxide.

The CO2 is a safer alternative to other methods of dye release, Primault said, and cuts down on accidental activation. Also, he said, no cassette capacity is lost, as is the case with some competitors.

Mike Grajewski, director of marketing for 3SI Security Systems, which is headquartered near Philadelphia with a European office in Brussels, Belgium, said that not all of his company's products demand cassette space. "It depends on the configuration of the ATM," he said, noting that no more than 400 notes would ever be displaced.

(Editor's note: 3SI until recently was known as ICI Security Systems)

The newest versions of 3SI's Scorpion, which is used with cassettes both during cash delivery and inside of the ATM, do not displace bills, Grajewski said.

Europeans more receptive

The company's products -- which also include the Security Pac, which is placed in teller drawers and other areas of bank branches; the SecuriSafe, which is used in safes; and the Octopus, which is self-contained within ATM vaults -- are installed in 42 countries in North America, Europe and Asia.

The largest market is France, said Grajewski, noting that 3SI first developed a version of its cash staining technology for ATMs at the behest of the French government in the late 1980s.

Unlike the U.S., where cash-in-transit workers carry firearms, the emphasis in Europe "is less on gun power and more on technology," Grajewski said. While 3SI has installations in the U.S., the American attitude is "more laissez-faire," he said. "We see more interest in the States when there is a rash of attacks," as occurred recently in New York City.

Companies that sell cash staining systems recommend that warnings like this one be posted on ATMs equipped with the technology.

It's more common for European insurers to provide incentives to use cash staining technology, Grajewski said, offering lower rates or insuring an ATM's entire contents rather than the more common 25 percent.

The U.S. attitude is "evolving," Grajewski said. "Interest is growing, but I think we're a little ahead of the curve."

Fluiditi's Primault believes there are specific opportunities for cash staining technology in the States, such as standalone ATMs in remote locations like highway rest stops where it may be difficult to schedule armored car cash deliveries.

The stain knows

All of the companies that sell cash staining solutions agree that both criminals and the public need to be educated about the technology to make it a truly effective deterrent. They recommend posting highly visible warnings at the ATM.

"The criminals will avoid it because they don't understand it," Primault said. "They prefer targets they understand."

While all dyes are somewhat different, Primault claims that Fluiditi's dyes withstand tests where 50 chemicals, in different combinations, are used to try to remove the stain. "The ink of the note itself becomes black, so it is useless," he said.

3SI's products emit red smoke as an added deterrent, Grajewski said. "That way, any bystanders become witnesses. Many criminals just panic and drop the cassette at the first sign of smoke."

It's important to educate the public to ensure that stolen notes are not kept in circulation. Fortunately, Grajewski said, many people instinctively do not want cash that is badly stained. It generally doesn't go through many hands.

In one case, he said, a bank teller in Tennessee questioned her customer about the bright pink money he was trying to deposit. A mechanic, he had received the cash from a customer. The teller informed police, who set up a sting operation and collared the thief, who had tried to remove the red dye by soaking the money in bleach.

Some newer versions of 3SI's dye contain a synthetic DNA that can be used to even more effectively identify criminals who get it on their clothes and other personal items, Grajewski said.

Accidents do happen

The European Central Bank (ECB) issued a directive prior to the launch of the euro asking national Central Banks to instruct retail banks not to accept stained notes. Instead banks are encouraged to ask those depositing the funds where they obtained the notes.

Credit can be given if a satisfactory explanation is provided, then the Central Banks will exchange stained notes with clean currency on a one-for-one basis. If the notes were stained accidentally, the Central Banks may charge a small administrative fee.

While accidents do happen, Grajewski said they are rare. "When you use the products properly and as intended, there is no problem," he said. "If you don't respect the procedures and go from A to D, skipping B and C, then you open up the chances of an accident."

In the UK, an organization called BankNote Watch distributes educational materials to retailers advising them not to accept stained notes, and educating them about what to do if they do get stained cash. Alan Townsend, a London police detective who helped organize the group, said it appears to be working.

"In the past two years, the Bank of England has seen a massive increase in the numbers of people turning in stained notes," he said.

According to Townsend, there are more than 21,900 cash staining systems in the UK today, approximately 9,300 of them used to protect cash in ATMs and during delivery and the rest in financial institutions and retail stores. He believes those numbers will grow.

"Over the next 10 years, I think a vast majority of financial institutions will go over to some kind of ink staining technology," Townsend said. "It's nearly the ultimate deterrent. The ultimate, I suppose, would be if you could make cash disintegrate in someone's hands after it was stolen. Ink staining is about as close as we can get."