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The Truth About Identity Theft: Truth 27 -- ATM Scams

Can someone build a fake ATM to steal your card and pin? The author did. Learn how he constructed a fake ATM and how to protect yourself.
This chapter is from the book

This chapter is from the book

Throughout this book, I have discussed a variety of ways in which identity thieves have devised to separate you from your hard-earned cash. Thieves use everything from brute force to subterfuge to confidence schemes to technological wizardry to steal your money and perhaps even your identity. So by now it should come as no shock that identity thieves will even go so far as to set up a fake ATM to empty your bank account.

Identity thieves have used numerous techniques to attempt to gain people’s PINs. In some cases, they’ve placed a small camera hidden somewhere on the ATM. In one example, the thief made a fake flyer holder containing a tiny camera that was attached to the ATM. A small hole had been drilled into the holder so that the camera could see and record users entering their PINs. In other cases, thieves have taken a lower-tech approach and just sat near the ATM and used a high-powered lens to watch as people entered their PIN.

While fake ATMs got their start back in the early 1990s, most people have never given them a second thought. In fact, because ATMs now come in every size, shape, and color, most people would be hard pressed to know the difference between a real ATM and a fake one. With this in mind, I decided to see just how easy it would be to run this attack myself.

First, I decided I would try to purchase an ATM machine on eBay. While I did find ATM machines I could purchase, they were more expensive than I expected. And I thought even if I did purchase an ATM, I would have to reprogram it. So I decided to build my fake ATM.

After more searching, I discovered a college that was selling four large metal kiosks. The kiosks were seven feet tall and had plenty of room for a small monitor and keyboard. After winning the auction, I had the kiosks shipped to my corporate office, where several of our engineers got to work on them. We ordered large "No Fees!" stickers to cover the sides and front. I also ordered touch-screen monitors and magnetic strip readers. One of my engineers changed out the keyboard shelves and placed a nice sticker atop it indicating the types of cards that were accepted.

Once completed, my ATMs looked just like the real thing—at least at first glance. Had people paid close attention, they would have noticed there was nowhere for the money to come out, and there was no way to get a receipt. I assumed since this machine was never going to give money or receipts, no one would ever be looking.

Next, we wrote a basic program that would provide screen prompts for the user to insert a card, enter a PIN, and enter a transaction. Since the whole idea here was to prove that this could be done and not to actually steal anything, the program recorded only the last four digits of the account number and simply counted the digits in the PIN.

I now had several fully operational ATM identity theft devices. We loaded two of the machines into a rental truck and took them on the road. We ended up placing them in Austin, Texas, on 6th Street. This busy street is known for its many bars and nightclubs. My goal was to see if anyone would become suspicious and, of course, if anyone would actually use them.

To say that we had success would be an understatement. In just under five hours, we were able to capture 27 card numbers and could’ve captured the PINs if we’d wanted them. This means that had I been a real identity thief, I would have been able to take that information, make my own fake ATM cards, and go out on a shopping spree.

Of course, because the machine couldn’t dispense money, as soon as it was apparent that the user had been duped, I told them about the "scam." Interestingly, even after the machine had failed to process the transaction, the victims never thought there was anything malicious going on. When I pointed out obvious flaws, such as the missing money feeder, the victims would laugh and say they couldn’t believe they had missed that important detail. The comment I heard repeatedly was, "How can we tell a real ATM from a fake when they all look so different?" It’s a valid question without a simple answer.

Instead, I can merely offer a number of tips that, when combined, can help protect you from falling victim to this type of attack.

  • Beware if the ATM doesn’t charge fees. Private ATMs not associated directly with banks (often seen in service stations and bars) make their money through fees. While it’s possible that there could be a privately owned no-fee ATM out there somewhere, it’s definitely something to raise an eyebrow.

  • Look around. Is the ATM free standing? While ATMs can be anywhere, you want to avoid the ATM that is freestanding outside. Avoid ATMs that are not bolted to the side of a building or secured inside a facility. If you can walk up and start pushing the ATM down the street, this is generally a bad sign.

  • Take action if the ATM failed to process your transaction. Most ATMs do not allow you to attempt to sign in when they are out of service. Instead, nonfunctioning ATMs post a message onscreen indicating that they are down or offline. If the ATM shows an error message after you have submitted your card and your PIN, contact your bank immediately to report what happened.

  • Follow the layered approach. For example, if the machine offers no fees but it is attached to a building and everything processes properly, you are probably fine. It’s when you start seeing several of these tips combined that you should be seriously concerned.

  • If you use an ATM that doesn’t dispense cash, you are at far greater risk that it was a fake and should notify your bank of the potential risk to your account.

  • Pay close attention to the slot you slide in your card. If it looks strange or bulky, try to push on it with your hand. If something has been stuck over the real reader, it will wiggle or even come off. If you spot one of these, most likely, it’s a device that an identity thief placed on the ATM to read your card as you place it into the ATM slot.

  • Always be aware of your physical surroundings. Using an ATM late at night in an empty parking lot is asking for trouble. Also, it’s a good idea to shield the keypad with your hand as you enter your PIN to prevent a hidden camera from capturing your information.

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