Card skimming on the decrease

The number of card skimming attempts has decreased significantly this year, according to recent statistics released by FNB Credit Card’s Fraud department on Thursday.

FNB said that in March 2007, the gross fraud amount for industry counterfeited cards stood at almost R8,5-million, then shot up to R15,63-million in March 2008.

A slight increase was evident in March 2009 with a gross fraud amount of R17,82-million. March 2010 statistics indicated a decrease to R8,968-million.

“When these statistics are taken into consideration, consumers have to be empowered with the knowledge to recognise fraudulent activities,” FNB said.

FNB Credit Card’s fraud specialist, Henk Vermeulen, said consumers should firstly understand how credit card skimming took place for them to successfully identify a scam.

There were predominantly three methods of card skimming.

Firstly, skimming could take place with a handheld device at retail merchants when the card was taken out of sight to process the transaction. Another method, which was also done with a handheld skimming device, was when fraudsters distracted consumers at ATMs to obtain their pin and card details. The fraudster fabricated another card with this detail and drew money from the cardholder’s account.

The third method of skimming occurred when fraudsters placed a high-tech device, disguised as part of the ATM, over the actual card slot. Once the consumer used the ATM, their cards were skimmed.

“Fraudsters can also place micro cameras and pin pad overlays at ATMs to obtain the consumer’s pin,” Vermeulen said.

“Once in position, these devices can be remotely accessed from a nearby secure location to obtain the necessary card and pin numbers required without the criminals needing to approach it.”

Vermeulen said once consumers realised they had been victims of a skimming attempt, they should immediately contact their bank’s fraud department or customer call centre.

He said banks were currently in the process of replacing magnetic strip cards with chip and pin cards, to reduce incidents of card skimming.

“The newer chip and pin cards function with a pin and not a signature, which makes all transactions significantly more secure.”

The one disadvantage of chip cards was that they were not accepted in all countries.

“To avoid inconveniencing our clients, FNB’s chip-enabled cards still have fully functional magnetic stripes to enable consumers to transact across the globe and customers must, therefore, still be cautious of skimming attempts.”

Vermeulen said that by reporting suspected fraudulent activity, consumers could help to create a greater awareness of card crime, and reduce card skimming.

An earlier version of this report by the South African Press Association incorrectly stated that the practice of card skimming was on the rise. — Sapa

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