Robert Siciliano and fraud victim Jonathan Basileidis explain how criminals use skimming devices on ATMs to steal debit card data and PINs. They walk through real theft cases and show how to spot skimmers and protect your account.
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$1 billion. That's how much money scam artists stole from debit card users last year. And unlike credit card fraud, where you can dispute charges before money is ever taken from your account, that's not the case when your debit card is involved. They're easy to use and convenient, and if you watch your balance, using a debit card instead of credit is a good way to manage your money.
I can control my money that way. I know what I can spend and what I can't spend.
But at what price? Thieves are targeting debit cards like never before, and when they get a hold of your account number, they can drain your bank account in no time. It happened to Jonathan Basileidis.
There were charges upwards of $4,000 from Las Vegas and from out of London for clothing, electronics, restaurants, all kinds of stuff.
You won't catch me alive or dead using a debit card.
A big statement from security expert Robert Siciliano, and you can blame this little device for it. He showed me via Skype it's the weapon of choice for debit card thieves.
When you come through and you slide your card right through, then it skims the information off the back of the magnetic strip.
And check this out. This is a rare glimpse at a thief in action. Surveillance video caught this scam artist at a Daytona Beach Bank of America installing a skimmer at the ATM machine. For 7 hours, customers unknowingly swiped their card, and a camera the bad guys installed capture their PIN number.
From there, the bad guy will take the ATM skimmer off the face of the ATM, download the data, and in some cases they can access the information wirelessly.
Then, using a machine they can simply buy online and your information, they create a new card they use to either empty your checking account at an ATM or to start shopping. And if you have your checking account set up for overdraft protection or linked to another account, they can steal feel even more. And it's not just at ATM machines. Thieves are installing skimmers at gas station pumps and other places people use debit.
The major problem with a debit card is that when your card is skimmed, the money is taken directly out of your bank account.
And you won't get it back until the bank does an investigation.
You have to jump through all kinds of hoops to prove to the bank that you weren't the one that withdrew the money out of the account.
Meanwhile, you don't have the money to pay other bills. The bank worked with Jonathan, didn't hold him liable, but he was left to deal with overdraft and bounced check fees in the process.
Given the customer service I received, we actually took our savings and went to another bank.
So how do you protect yourself? Know your ATM, what it looks like, so you notice any changes. Because of increased surveillance, bank ATMs are thought to be safer than freestanding ATMs or ones in convenience stores. Cover the keypad as you enter your PIN number. Use cash or credit at the gas station, but if you do use debit and your card allows you, select the credit option so you don't have have to enter a PIN number. The money will still be deducted from your bank account right away, but it will give you some protection. And finally, watch your account. Computers make it easy to check it often because you never know when or where the bad guys will strike next. Debit cards with a Visa and MasterCard logo limit consumers' liability in most cases to $50 if their debit card has been compromised, similar to a credit card. But with other debit cards, you can be on the hook for up to $500 if you don't report report the fraud within 2 days. You might want to check with your bank to see what protections come with your card, but get ready for a headache if your number is ripped off. I'm Joanne Perton. Back to you.
