How Credit Card Skimming Works

Credit card fraud victims remain blindsided until they notice some fraudulent charges or unauthorized cash withdrawn from their bank account. Unfortunately, skimming victims remain unaware of this theft until their card declines unexpectedly or they receive their user account details.

Before we plunge into the details to find out how you can detect credit card skimming, it is important to understand how skimmers work.

What Are Skimmers?

Credit Card Skimming happens with the help of a compact, illegal device called skimmer that is attached to the card readers- particularly at the self-service terminals.

These advanced machines are hard to spot by a nonprofessional because of their compact design but there are ways that can help you spot skimmers in various places.

How do Skimmers Work?

A skimmer comprises two components, a device, and a camera.

The device plays a major part in the theft as it is attached to the card slot to create a copy of one’s credit card details. When one inserts the card, the small device first captures his bank data and then stores all the information on the magnetic strip of the card. That magnetic strip contains all the important account details that include one’s card expiry date, cardholder’s name, along with his credit card number.

The second important component of the skimmer is an undetectable camera, which is placed mostly on the top of screens in a way that it faces the keypad. The purpose of this camera is to capture one’s PIN or password when someone enters it in the machine. It does not affect the function of the terminal, but the hacker easily copies your card account information via a magnetic strip.

Where Are Skimmers Located?

Gas stations, stores, restaurants and isolated ATMs are the commons spots where skimmers are placed; however, they can be attached to any card reader.

What may seem like a normal transaction to them is actually a plot to steal your bank account details. Once the information is copied, a hacker can easily create a cloned card to use your money via online purchases. Many hackers also steal the information to sell on the internet.

You can be a victim of skimming at your favorite restaurant at the hands of the workers who are recruited to work for skimming ring. These workers use the opportunity by swiping your card through a handheld device to copy information.

Ways to Spot Skimmers

Though skimmers blend seamlessly with ATM machines, you can detect them with the help of few tricks.

  • If you find a card reader protruding out from the ATM machine, check it before swiping your card.
  • Compare any suspicious card reader with other nearby pump readers. If anything looks out of place, do not pay.
  • Avoid swiping card if the card reader is not fixed on its place, or feels tampered.
  • If the keypad of the machine seems difficult to push, do not use it. It may be a fake keypad attached to capture your card’s PIN.

You can avoid credit card skimming by paying a slight more attention towards card reader and its appearance. Becoming familiar with the feel and look of regular card reader can also help you notify skimmers.

Do Not Swipe Your Debit Card at These Five Places

It is very common these days to hear news about data breaches at retail locations or restaurants. In the recent past, a number of cases have been reported where people had become the victim of identity thieves or hackers because they had swiped their debit cards on various places.

Every time you use your debit card at an unsafe place, you risk your banking information. Here we have listed three main spots that entail the high risk of cyber theft.

1. Restaurants and Hotels – Restaurants can be a source of danger. There are some unscrupulous servers, who bring handheld skimmers to the restaurants to steal your credentials. Not only this, there are some low-tech cyber thieves who copy your card numbers.

The trouble does not end here. Many restaurants are using older computers for processing debit card information, providing an easy access to hackers, and cyber thieves to install malware or card-swipe software.

This can be dangerous and cost you a high price. Subway, in 2011, was hacked by Romanian cyber gang, who stole around $11 million from its different branches.

2. Gas Stations – Gas station is another favorite spot of thieves to install skimmers. These skimmers have Bluetooth that allows thieves to easily extract and collect the PIN numbers wirelessly.

To avoid this situation, it is better to use cash at the gas station. If it is not possible, use your credit card instead of debit card at pump. The liability for credit card is only $50 for fraudulent purchases and it is convenient to contest than debit card.

3. Stores – Stores are also an easy target like gas stations or restaurants. They have tons of customers; many of them are not from the same area.

Some other places which entail the same risk are online shopping portals, outdoor ATMs, and cell phone charging spots.

The safety rule is same here. Use cash for your small purchases at stores while buying grocery or clothes. You may use credit cards for making larger purchases as it has less liability than debit card.

4. Online Shopping – You cannot use cash while shopping online, but using a credit card instead of a debit card is a key here. Not only will you get better fraud protection with a credit card, but also fraudster will not be able to overdraft the details of your bank account.

5. Mobile Vendors – Whether visiting the market or shopping at a street fair, using your debit card on different mobile vendors is not secure.

A number of mobile vendors have a plastic dongle that is connected to the smartphone for accepting debit card payments. These machines may have skimmers attached to them that can record your bank credentials. It is better to use Apple pay or Android than swiping your debit card for your safety.

Precautionary Measures

Overall, ‘precaution is always better than cure’.

Using cash is an alternative to this problem. However, at the same time, this solution sounds impractical because you cannot carry cash everywhere -especially if you are traveling and cash back credit cards can give you rewards that cash simply does not provide.

You also need to be vigilant while carrying cash or getting cash from ATM. Cyber gangs or ATM infectors are very smart at installing invisible skimmers devices on ATM. This infects ATM with a malware virus that steals your debit card information. There is a miniature camera attached on the keypad of ATM to copy your PIN. This is all they need to know to drain your bank credentials.

Avoiding isolated areas for cash transactions and using ATMs located at the restricted-access foyer are some easy options to minimize this fraud exposure. However, knowing only how to get cash safely is not enough, you should also know where you can avoid swiping your debit card.

In addition, make sure that you check your credit reports, and bank statements for any suspicious activity.

By considering these small things while using your debit card will definitely pay you off in a long run.