As we all experience a never-ending stream of financial scams, let’s talk about card reader skimming — what it is and how to protect yourself.
What is skimming?
Skimming is a type of fraud that collects your information at merchant card reader machines where you insert or swipe your debit and credit cards. These include stores, ATMs, gas pumps, and ticket dispensers — just about everywhere these days.
Installing a skimming device takes seconds — and it only takes seconds for your card information to be stolen. Those stolen card numbers add up! According to the FBI, consumers and financial institutions lose more than $1 billion annually to skimming scams.
How skimming works
Modern card skimming devices are very sophisticated and easy to purchase on the black market. They can be attached over the card slot or placed inside the card slot or a card reader machine — and they look like they are part of the machine!
These small electronic devices collect the data from the magnetic strip of a credit or debit card. An artificial keypad or small camera nearby may record your PIN. Stolen data stored in the skimming devices is then downloaded or transferred wirelessly. Once they have sensitive personal information, fraudsters will use your card data to clone the card, or to make online shopping purchases.
Other kinds of skimming
While the physical copying of data via a card skimming device is the most traditional scam, we’re also seeing a rise in other methods.
- Internal skimming, which involves malware installed on a hacked merchant system or network that captures data as transactions are processed.
- Bluetooth or wireless skimmers, which can be placed near pay terminals to wirelessly capture and transmit stolen data, compromising chip or contactless payment options.
- Online skimming, which can also occur via e-commerce transactions, most commonly on sites without SSL certifications.
- Card trapping, which occurs when a point-of-sale (POS) machine holds a card and doesn’t release it, so a scammer can collect it later.
10 ways to stay safer
- Look at the card reader before using it. Scan for cracked, scratched, or damaged parts, parts of different colors, or graphics that look misaligned or tampered with.
- Compare machines. If there are more than one near each other, see if there are differences in their appearances (e.g., one has a light or graphic that the other doesn’t have).
- Protect your PIN. Scammers set up cameras near skimmers to capture your PIN. Cover your PIN as you enter it. If the keypad is difficult to use, it might be compromised, so stop entering your PIN.
- Use bank ATMs. Most skimming occurs at privately owned ATMs, such as those found at bars, gas stations, and convenience and grocery stores.
- Use a card reader in public view. Choose the most visible, well-lit POS machine if you are at a gas station pump or other location.
- Use tap-to-pay or mobile wallet. These options can prevent a card from being skimmed. Remember, contactless and chip cards offer extra protection, but they can still be skimmed.
- Pay inside or use the credit option. If tap-to-pay or mobile wallet isn’t available, you can go inside to pay and avoid the risk of skimming. Using your debit card as a credit card bypasses the need for a PIN.
- Shop online only with SSL-certified sites. SSL certification provides added security. If the URL is SSL-certified, it will have “https:” at the start of the web address.
- Review your accounts. Log onto your Fremont Bank accounts anytime to check your accounts and catch anything suspicious more quickly.
- Use available protections. Fremont Bank offers security options, including transaction text alerts that may help you catch a fraudulent transaction more quickly. Explore and set up alerts.
Contactless and chip cards offer extra protection, but they can still be skimmed. Be sure to review your accounts regularly; it improves your chances of recognizing skimmer scams!
Concerned you’ve been the victim of a card skimming scam? Follow our steps for reporting fraud.
