News

Man pleads guilty in Australian skimming case

August 10, 2003

SYDNEY -- Kok Meng Ng, a 29-year-old Malaysian national, pleaded guilty on Aug. 11 to fraud charges resulting from Australia's first ATM skimming scheme.

According to a report in the Sydney Morning Herald, the scam netted more than $620,000 from customers of three banks. (See related stories Australian authorities arrest Malaysian national in ATM case and Australian authorities discover skimming scam)

Ng pleaded guilty in the NSW District Court to a total of four charges of breaching the Commonwealth Financial Transactions Act and computer offenses.

Ng was part of a skimming scam which robbed 315 Sydney customers of the Westpac, Commonwealth and St. George Banks of $623,426 ($409,534 U.S.) in October 2002, although the operation ran from May 2001 to November 2002.

A skimming machine was placed at ATMs and small cameras placed above the keyboards, according to the Morning Herald report.

Police have only recovered $34,800 ($22,859) of the stolen money; most of it is believed to be in Malaysia and Singapore.

Detective Inspector Michael Gerondis told reporters outside the court that this was the first ATM skimming scam in Australia.

Gerondis said Ng's accomplices fled the country after his arrest. "Unless they come back it would be very difficult (to arrest them)," he said.

Ng faces a sentence of five years for the charge related to the Financial Transactions Act and an additional three years for the computer offenses.

David Bell, of the Australian Bankers' Association, said the law needed to be tightened to make possession of electronic skimmers a criminal offense. Skimming was being targeted by the association's fraud taskforce, he said. Banks are beginning to use technology to detect unusual transactions, and educating customers and merchants so they can help identify cases of tampering.

Ian McKindley, a risk manager with Visa International, said 50 percent of credit card fraud in Australia, worth $50 million ($32.8 million U.S.), was the result of credit card skimming, up from 5 percent in 2001.

McKindley said that 75 percent of the skimming was from cards used at point-of-sale terminals in gas stations. In many cases, he said, employees "harvest" credit card details for organized gangs. An unidentified woman was arrested in Sydney recently after allegedly offering store employees $150 for each card they skimmed.