The story goes that two astronauts, one American and one Russian, were sitting together at a meeting and got to talking about the everyday inconveniences of gravity-free living. The American began to explain how NASA had overcome the problem of writing in space — because without gravity, the ink in a ballpoint pen wouldn't flow.
One U.S. company came up with an ingenious solution, the astronaut said. They developed a battery-operated pen equipped with a tiny motor that actually pushed the ink down to the ballpoint.
"We used that pen on our next space mission," the American said proudly. After a pause, he looked at the Russian and said, "You must have had the same problem. How did you solve it?" To which the Russian replied, "We used pencil."
Complicated problem, simple solution
The tale is probably fiction, but the fact remains that not every complicated problem has to have a complicated solution.
In the ATM business, M&T Bank's anti-skimming invention, the Blocker, is a case in point. Fabricated from high-impact polycarbonate and secured to the ATM with six metal rivets, the device makes it impossible for a would-be thief to install a fake bezel over the machine's card slot.
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Though impact resistant, the polycarbonate components are not quite kryptonite. However, they don't actually need to be because: a) an individual hammering away at the card slot of an ATM with a baseball bat probably would attract some attention; b) the remaining plastic base and rivets still attached to the front of the machine would be in the way of the fake card bezel; and even if a look-alike skimmer were to be placed over the card reader, the rivets and broken plastic next to it would be a fair indication to a customer that something fishy was going on with that ATM.
Carolyn Criscitiello, vice president of alternative banking at Buffalo, N.Y.-based M&T Bank said that a fraudster could not defeat the Blocker without becoming the one thing he least wants to be: conspicuous.
"It could be broad daylight when they're there, so they want to get in and out." She said. "Put the device on, get out and be inconspicuous. So [Blocker] makes it more trouble than it's worth." And if one ATM has a Blocker, well, there's another one somewhere that doesn't.
For 'endless makes and models' of ATMs
The now-patented anti-skimming device was developed in July 2011 by M&T Bank for use on its own 2,000 ATMs (the bank currently has Blockers installed on about 70 percent of its machines, Criscitiello said). But recognizing its utility, the bank announced in November 2011 that it would license the product for sale to IADs and other FIs.
Pendum is one licensee. Company CEO Brad Browder said it was astonishing that a solution as simple as the Blocker could be as effective as other, far more expensive anti-skimming approaches. "It's amazing — you can protect a machine against skimming with a device that costs around $200," he said.
Because M&T developed the product simply for its own use, the first Blockers were designed to fit the ATM makes and models in the M&T fleet — primarily NCR and Diebold machines. But product literature calls the Blocker a "vendor-neutral solution [that] fits most ATMs and many other card reading devices." And so does Criscitiello.
"Conceptually, the Blocker can be affixed to endless makes and models," she said. "But it does have to fit with that make and model. We have pieces that are used right now across several different makes and models."
Criscitiello was not able to provide figures showing just how well Blocker was working to prevent skimming. The bank does not share that information publically, she said, "But we can say that we feel it's been very successful."
ATM skimming on the rise
In its most recent report, EAST identified skimming as the greatest security threat in the ATM industry, and the U.S. as the number one target of skimming gangs. Their activities cost card-issuing financial institutions $2.4 billion annually in fraud losses, according to Mercator estimates.
As the last EMV holdout among the world's developed nations, losses from skimming in the U.S. will only increase, along with the demand for effective, cost-efficient anti-skimming solutions. You don't have to be a rocket scientist to figure that out.
For more on this topic, visit the security research center.
graphic: Jen Montes