Credit cards, ATMs indeed revolutionized the way transactions were carried out. They not only provide you with a convenient gateway to pay your bills or make purchases, but also significantly cut down your transaction time. You no longer have to battle long queues just to withdraw money from a bank, nor do you need to deal with harried employees at bill payment counters. However, all this hi-fi technology has also offered newer avenues for unscrupulous people to conduct nefarious activities. Skimming fraud is one such white collar crime which is often in news for its sophisticated mode of crime.
What is Skimming Fraud
Skimming fraud is any fraud in which the card information is illegitimately obtained and used without the knowledge of the card holder. It can be of various forms depending upon the nature and extent of the crime. Equity skimming fraud which involves siphoning equity from the homeowner by the lender or investor at the cost of a small down payment is common in real estate industry. However, credit card skimming and ATM skimming are amongst the most common types of skimming frauds. More often than not, these crimes involve sophisticated skimming devices which read protected information from your card and transfer it to the skimmers. However, sometime credit card skimming can be accomplished with a mere pen and paper. How? Let us see.
When you hand over your credit card to a waiter at a restaurant, do you ever think that he could misuse it? Probably not. However, the misuse of your credit card at the hands of a waiter is very much possible. In fact, it is one of the most popular modus operandi of skimmers. The waiter (or any other person for that matter) surreptitiously swipes your card into a skimming device which records all the information of your card. Alternatively, he may note down the details of your card with a pen and paper. This information is then used to make a counterfeit card by the skimmers, who can then use it in number of ways. Credit card frauds are more prevalent at stand-alone point-of-sales, kiosks, gas stations and similar places which offer little or no surveillance.
In ATM skimming, mostly hi-tech devices are used for the purpose of skimming. Oftentimes, a fake keypad is installed over the real one, which records your keystrokes when you type your PIN. It may also include a compact gadget on the card slit which reads the information on your card and then transmits it to a skimmer. This information is used to make a duplicate of your card. Sometimes, a pinhole camera may be installed at innocuous places on the ATM. This camera overlooks the keypad and screen to pick up vital information about your card.
How to Protect Yourself from Skimming Frauds
Skimming frauds are very difficult to detect immediately. This is because most users are unaware about the misuse of their card, since the card never leaves their possession (except for unsuspected brief moments at restaurants, point-of-sale etc.). To avoid this, keep a close watch on all the transactions where manual handling of your card takes place. Similarly, avoid transactions at unguarded kiosks, gas stations, etc. In case of ATM transactions, choose ATMs located outside banks, since they are likely to have more security and surveillance. Check for any unidentifiable objects, devices on the ATM. If you suspect anything, inform the bank authorities and select a different ATM for your transaction. In case you fall prey to any such crime, make sure you educate yourself about credit card fraud penalties which may provide you some relief.
Skimming fraud can be brought into light sooner if you frequently monitor your accounts. This will enable the law enforcers to nab the culprits at the earliest.
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