How can it be that summer is already drawing to a close? It seems like school just let out! But it’s August, and that means back-to-school shopping for thousands of metro families. Many shoppers are opting to use a debit card to pay for those purchases, increasing the potential of becoming a victim of various high tech scams.
One of these is skimming, where criminals attach devices to ATMs and other card readers to steal your account number. The problem has become so prevalent that the Comptroller of the Currency released a consumer alert identifying ATMs and money machines in well-traveled public places as the most vulnerable to fraudulent activity, but care should be taken at any money machine.
Skimming is increasing due to advances in technology and the proliferation of small but powerful electronic devices. The most common form of skimming is attaching a simple plastic device to the card slot so it can either read the card’s magnetic strip or computer chip. These devices either transmit the information immediately to a base unit or store the information on the device itself.
A second type of skimming is strategically placing a small camera either on the machine or above it to record the information on the card as well as your PIN. Cameras can be monitored constantly, giving thieves immediate access to your account. Often these devices are combined, which provides complete access to your checking account. And to make matters worse, most scammers sell your information to others—giving them access as well.
Financial institutions, retailers and consumer advocates are aware of these problems and are taking steps to help minimize your risk. However, the ultimate responsibility still lies with the card user—you.
When shopping online or by telephone, be sure the retailers confirm your identity by asking for some form of personal information: address, the last four digits of your social security number, or answers to security questions. They may also ask for the three-digit security code on the back of your card. Because scammers often use sophisticated software to automatically process orders, more and more online retailers are increasing their security measures.
Other precautionary steps include:
- Walk away from an ATM if you notice someone watching you or if you sense something is wrong. You may even want to report such activity to your bank, the company operating the machine or a local law enforcement officer.
- Check the card slot on the ATM for a plastic sheath and the area for small objects that might conceal a camera.
- Stand close to the ATM and hold your hand over the keypad or screen as you enter your number, making it more difficult for someone else to see it.
- Never accept help from strangers offering to help you with an ATM that appears to be disabled or working improperly. In fact, you should notify police or the company operating the machine immediately.
- Keep your PIN in a secure place at home. Never carry it with you. If you have trouble remembering your PIN, find a way to disguise it as a phone number or other multiple-digit number that only makes sense to you.
- Review your account statements regularly, either online or on paper, looking for unauthorized withdrawals or purchases. If you find something suspicious, contact your bank or credit card provider immediately.
- Be aware of your rights and responsibilities with your card and money. Two federal laws provide some protection from illegal use of your debit and credit cards. The Truth in Lending Act generally limits your liability to $50 for any unauthorized charges. However, you are not responsible for any charges if you report your card lost or stolen before it is used. The Electronic Fund Transfer Act limits liability on unauthorized use of your debit or ATM card; however, the liability limit depends on how quickly you report the misuse of your card or account number. You may also want to ask your financial institution about its policies regarding fraudulent access to your checking account or debit card.
Download the Credit, ATM and Debit Cards: What to Do if They’re Lost fact sheet from the Federal Trade Commission at www.ftc.gov/bcp/edu/pubs/consumer/credit/cre04.shtm. Also, the Office of the Comptroller of the Currency has answers about unauthorized charges and other banking issues at www.helpwithmybank.gov.
Sue Lynn Sasser, PhD, is a professor of economics at the University of Central Oklahoma
