Over the weekend of Feb. 1 and 2, dozens of local residents noticed unexpected charges on their bank accounts as the result of a “skimming” fraud, wherein hidden devices that steal PIN numbers and zip codes are placed on credit card machines, making them undetectable by consumers. Once the credit card information is stolen, it can be sold to other criminals who then use the credit card information for cash withdrawals.
This most recent skimming incident involved an estimated 165 Vantage West Credit Union members, as well as members of at least three other financial institutions. Although the foreign charges showed up on users’ accounts at the beginning of February, the skimming incident itself may have occurred a month prior.
“There were hundreds of individuals, as far as we know, from multiple financial institutions,” said Jill Casey Pintor, assistant vice president of communications for Vantage West. “An important point is that, although the individual cards were compromised, the account itself was not compromised. So. this is good news, and the other good news is that our team moved swiftly and it’s now considered resolved.”
The location of the skimming device is still being investigated, although 60 percent of the time, skimming devices are located at gas pumps.
“Skimming is unfortunately something that is happening, and while the financial institutions are doing what we can to protect our members, the best defense from this lies with the merchants,” Pintor said.
It is estimated that gas stations are so often targeted because gas pumps are located outside of businesses and therefore easily hacked, and because gas stations and convenience stores are some of the last merchants to update their card readers to “EMV chip” enabled devices, which are resistant to skimming devices.
Visa has mandated that all merchants upgrade their “pay at the pump” equipment to the more secure EMV chip technology by October 2020 to avoid potential financial penalties.
“That’s an extension that has been granted by Visa, so if you think about the ecosystem of how payments work, Visa stands in the middle, connecting people and merchants who are accepting transactions, with those of us like Vantage West who then authorize those on the back end,” said Andrew Downin, chief marketing and strategy officer for Vantage West.
Beyond waiting for merchants to upgrade their equipment with more secure technology, users can also help avoid skimming fraud by using mobile payment functions such as Wallet and Apple Pay, as well as paying for gas inside.
“We recommend people actively monitor their accounts,” Pintor said. “If they see unusual activity and report it immediately, that helps give us intelligence to shut down the operation, and we have an anti-fraud and security team that goes to work to see if there are others that might be impacted.”
Financial institutions also generally offer online tips for their users to help avoid fraud, however these measures are not 100 percent guaranteed to stop fraud.
“Not just us, but any institution that offers alerts regarding your account, we recommend you sign up for them,” said Brian Hillegonds, manager of Security and Fraud Investigations at Vantage West.
The good news is, EMV chip cards are much more resistant to fraud than traditional credit cards. From March 2016 to March 2017, Visa saw a 58 percent decline in counterfeit credit card fraud due to EMV integration. But for the time being, financial institutions maintain that “awareness is key.”
“The sooner we get that info, the sooner we can stop whatever fraud is happening,” Pintor said.