Monday, August 20, 2007

Counterfeiting for the 21st Century

by Heather Wells (Recovery Advocate)

One of the most common forms of identity theft and fraud is what is known of as “skimming”. This method of stealing someone’s credit card or ATM card information by using a portable reader is easy to do and difficult to trace. It also can pay off big time for the id thief who chooses to steal using this method.

Skimming can happen to you anytime your credit/ATM card is out of your possession. Restaurants, gas stations, and bars are common places that a less than forthright employee can obtain all the information they need to make online purchases or create a copycat card. The out of sight id thief will also make sure to take note of the 3 digit security code on the back of the card.

Skimming can also happen at an ATM that has a skimming device affixed to the card slot. The device will pick up the information from the magnetic strip and store it for later use. A small camera is often used in conjunction with the skimmer to get the ATM users PIN so the id thief can drain the unsuspecting victim’s bank account later on.

The magnetic stripe readers go for around $200-$300 dollars on EBay last time I checked, (do a search for portable magnetic credit card reader to see for yourself). The mini ones are kind of cute, and come in various shades of gray, black, white, and tan.

So, what should you do to avoid being “skimmed?” Obviously we can’t follow employees around and look over their shoulder when we hand off our credit card for payment. Just be AWARE of your surroundings. Making sure that your ATM transactions are secure and that there is not a device attached to the card slot is a start. But really, the best defense in this situation is a good offense. Check your credit card and bank statements as regularly as you can. If you see any transactions that you are not responsible for, let the company or bank know RIGHT AWAY.

The Fair Credit Billing Act (FCBA) limits consumer liability for unauthorized or fraudulent charges on credit cards, with a liability limit of $50.00 per card. The Electronic Fund Transfer Act (EFTA) that provides consumer protection states that if the loss or unauthorized ATM/debit card transaction is reported within two (2) business days, the consumer’s liability for losses is limited to $50.00.

If reported quickly, your bank should refund the entire amount. If they don’t, or try to hassle you, be firm with them and escalate the situation to a manager or branch manager if that’s what it takes. They should also assign you a new debit card number and PIN. If your credit card company gives you a hard time, ask to speak with someone in the fraud department and request an affidavit/affirmation to sign and deny responsibility for all fraudulent charges. They should close your existing account and open a new one with a new account number. You also should notify your local police department to report the incident. This will help to protect your rights as a victim in case the situation escalates.


r. arnold said...

Oh wow, I had no idea that this was happening!! I'll have to keep my eyes open wide next time I have to make a credit card transaction. It seems like a lot of these things are hard to avoid, which is very scary. Luckily for the consumer, fraud/credit protection from banks these days is very reliable.

I've learned something new today! Thanks for the informative post!

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