Thirty-six percent of all U.S. banking customers said they have experienced some kind of financial fraud in the past 12 months, according to J.D. Power, with unauthorized purchases on debit cards being among the most common occurrences.
As the busy summer travel season kicks into high gear, many consumers will find themselves using ATMs and debit cards in new places, so it is vital to take precautions to avoid falling victim to fraud.
Here is how scammers perpetrate ATM and debit card fraud and ways to protect yourself.
How it Works
Some common tactics include:
- Tampering with ATMs or point of sale (POS) terminals to place “skimming” devices on the machines. These skimmers can copy your card number and details, which the scammers will use later to create fake cards with your real information.
- Hiding cameras in ATM vestibules or nearby POS terminals to record your PIN when you complete your transactions. Once the fraudsters have your card’s information and your PIN, they’re on their way to their payday.
- Some scammers are so brazen as to stand nearby the ATM you’re using, pretending to be in line or using a nearby ATM, and then offering to help or give advice when the ATM doesn’t work for your transaction. This is a red flag that the machine may have been tampered with and the person “helping” you is a scammer capturing more of your information so they can access your accounts.
- Once scammers have successfully captured your information, they often make as many transactions as they can as quickly as possible to get your money before you’ve detected the fraudulent purchases. However, some scammers will also wait and start with a small “test” transaction of just a few dollars to see if the fraudulent purchase is noticed before attempting to steal larger amounts from your account.
How to Protect Yourself
- Before using any ATM or POS terminal, look closely at it to ensure there are no visible signs of tampering. This goes for the scanning device you put your debit card into to enter ATM vestibules after-hours as well. Scammers install skimming devices over the legitimate card readers and PIN pads that can capture your information without you even noticing. ATMs in travel hotspots can often be a big target for scammers as well, so be cautious of which machines you use. If something looks off, alert the bank or business you’re at immediately and go elsewhere for your transaction.
- Remain vigilant of those around you when you’re making withdrawals or purchases. Scammers have been known to linger nearby to try to capture your information as well as use hidden cameras to record your PIN. They may even be waiting for you to finish your withdrawal and just take the money from you right then and there.
- Always confirm you’ve completed your transaction and your account is no longer available on the ATM before walking away.
- When paying at merchants, consider using your card as a credit card where possible to avoid providing your PIN.
- Set up account alerts. This is a quick and easy way to be notified if your card is used for purchases over a certain amount, at particular retailers and more, which can help you quickly identify fraudulent purchases.
- If you’re withdrawing money to pay a friend or loved one, consider sending the money via Zelle® instead. Just ensure you truly know the person you’re sending money to before making any transfers.
If You’ve Been the Victim of Fraud
- Contact your financial institutions immediately to report fraudulent transactions. Have them freeze your account, get new cards and account numbers, and monitor your statements for any suspicious charges.
- File a police report and an identity theft report with the Federal Trade Commission.
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