News

Flexible ATM security

July 19, 2006

This article appeared in the ATM & Financial Self-Service Executive Summary, Summer 2006.

Stories of identity theft and database-security breaches capture headlines, but in the banking world the most prevalent crimes are considerably lower tech. ATM skimming and ram raids are major problems. Insider compromises are usually to blame for most ATM thefts and losses.

Industry estimates suggest that more than 80 percent of all losses at ATMs result from internal theft. But providing bank and service personnel access to ATMs is a necessary risk. ATMs must be serviced and cash must be replenished, and entrusting others with access to ATM cash can set up an ATM deployer for failure.

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Lock makers have tried to lead the industry to electronic locks as a way to address that quandary, said Orlando Consalvi, national product manager for Torrance, Calif.-based lock maker La Gard Inc.

La Gard's Navigator is one lock product that includes timed-access parameters that help financial institutions and independent sales organizations curb internal shrinkage.

More flexibility and options

But Jay Rehder, a former ATM service supervisor for ISO Red Hawk Industries, said small FIs need some built-in flexibility when it comes to ATM access.

To meet cash-balancing needs, Red Hawk placed Navigator locks on about 300 of its 450 ATMs in the Colorado area, Rehder said. The lock's audit trail facilitated balancing, and its dual-code lock feature provided room for flexibility, especially when it came to accessing remote ATMs.

Navigator is Web-based, meaning access to locks can be tracked and gained online. Being on the Internet allows greater access, if the deployer requests it. In Red Hawk's case, online access was a selling point.

"We liked the dual mode for our work with banks," he said. "With dual mode they can go in from the bank (from the keypad) and you can go in from the Navigator side (online). You have the same level of security, but it gives both parties access."

Security is not compromised because the lock comes equipped with three modes - normal, transport and service. FIs and ISOs can track in real time which mode is used to access the ATM. "So if you had certain techs that you only wanted to access certain sites, you could segregate the sites and split them up, making all the changes online. It gives you more control," Rehder said.

Consalvi said the dual-code lock feature was designed with the FI in mind, since most retailers refill and access their own ATMs. If they work with an ISO, then the ISO handles all the maintenance, leaving little necessity for numerous access qualifications.

"Banks always have a need for dual-user or -˜static mode,'" Consalvi said. "Bank employees need to access the ATM for bank openings and bank service, and so they want to have the normal keypad for access. If they work with a service provider, they want the service provider to have remote access. Navigator provides the best of both worlds."