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Fragmentation of ATM fraud reflects impact of counter-initiatives
- Dominic Hirsch
Regular attendees at the annual ATM Security conference, organized by RBR and ATMIA, will be aware that card skimming often dominates discussion — this is not that surprising because skimming is by a long way the most significant ATM crime.
This year's ATM Security conference was held a few weeks ago in London and there was a noticeable shift from previous years, with more talk than usual about other issues: There was more discussion of card and cash trapping, and also of alternative counter-fraud solutions such as geo-blocking (where restrictions are placed on where a card can be used), card usage monitoring and video surveillance.
The European ATM Security Team (EAST) has just released its biennial ATM crime report, which at least partially seems to support these observations. EAST collates figures provided by national representatives and, although vulnerable to reporting inconsistencies, is the only real source of hard data on ATM crime in Europe. EAST reports that ATM skimming incidents fell during the first half of 2012, but that the value of losses increased. This suggests that criminals are finding it more difficult to skim cards, but when they do they are extracting maximum value from each skimmed card.
The number of card trapping incidents has increased dramatically for the second half year period in a row, while incidents of cash trapping also rose slightly in the first half of the year. Cash trapping is notable because it was barely reported until around 18 months ago, and its risk/reward ratio is high because the gains from an attack are limited to the value of a single cash withdrawal.
Overall, the EAST report paints a picture of fragmenting ATM crime trends.
This is a reflection of the success of a number of anti-fraud initiatives, particularly EMV and anti-skimming, but a range of other solutions, too. In this environment, criminals are forced towards other forms of crime, unfortunately often reverting to more crude forms of physical attack on people or equipment.
This fragmentation will continue, not least because (belated) moves in the U.S. to adopt EMV will further reduce the value in skimming. This will take time, however, and ATM criminals will not disappear, so the industry must continue to innovate and be pro-active to protect the ATM channel.
Reprinted from Banking Automation Bulletin.
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