Credit Card Users Under Attack

Georgi Nikiforov, a Bulgarian native, plead guilty this week to skimming personal information from ATM machines around the Garden State and stealing close to $300,000. He faces a maximum penalty of 30 years behind bars.

In another skimming case, two class-action lawsuits were filed against Michaels Store Inc. in May after the national crafts-store chain admitted that some of its checkout-line card-swiping machines in 20 states had been tampered with allowing its customers’ personal information to be stolen. According to the lawsuits, more than 90 PIN pads had been affected.
Debit and credit card use has never been so dangerous.

Card users are having their identities stolen at shops, restaurants, gas stations and even ATMs. This high-tech, low-cost thievery is called skimming, and card users around the world need to know how to protect themselves from it.

The skimming takes place when users swipe their credit or debit cards through a PIN pad that has been fitted with a skimmer, a device that reads and copies the users’ information to include their names, card numbers and expiration dates. Every time a card is used there is an opportunity for a skimming theft to take place.

Furthermore, in March of this year, the FBI announced that it had arrested 83 Armenian Power members, an international organized crime syndicate according to the bureau, on a variety of federal and state charges to include skimming.

In a press release, the bureau said, “They caused more than $2 million in losses when members secretly installed ‘skimming’ devices in cash register credit card swipe machines at Southern California 99 Cents Only stores to steal customer account information. Then they used the skimmed information to create counterfeit debit and credit cards to empty accounts.”

Overseas, the outlook is no less hazardous. Down under, the Australian Crime Commission’s 2011 Organized Crime in Australia report stated that, “Credit and debit card fraud has tripled in just three years, with Australian consumers ripped off more than 657,000 times last year at a cost of A$170 million [$179 million].”

The report went on the say that the profits to be made with skimming have attracted international criminals from Romania, Southeast Asia and Sri Lanka.

How to Protect Yourself

First of all, credit and debit card users need to review their statements daily. With online banking, this has never been easier. Nor has it ever been more important.

Secondly, many identity security experts recommend that card carriers use credit cards instead of debit cards whenever possible. Also, many debit card transactions can be made as credit card transactions, a choice that should always be made. Consumers are able to recover their losses much quicker and easier in the case of credit card fraud, than with debit card fraud.

Additionally, card users should never punch their PIN number into a gas station PIN pad. Although the Michaels Inc. case demonstrates that card purchases can never be considered to be truly secure, PIN pads at gas stations are usually the least safe of all.

Finally, card users should try to only use ATM machines at banks. However, when card holders absolutely need to withdraw cash away from a bank, they need to avoid isolated ATMs, since skimming thieves tend to use these types of machines.

Follow @CreditDonkey or write to Andrew Green at andrew@creditdonkey.com

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