Clark Behind The Headlines
From HLN's Money Expert Clark Howard
A couple of years ago there was a criminal ring busted in New York City that was engaged in what was known as “skimmer fraud.”
The way it works is this: you go to use an ATM, and criminals have put a little plastic ring over the slot where you put your card. Inside that ring would be something that would record your card information before it went into the real slot. At the same time, while you’re punching in your secret code, you’re being videotaped.
So, they have both your card information and your four-digit code. They can duplicate that in seconds, and then within minutes - either somewhere else around town, around the country or overseas - they start emptying your checking account.
Now, this was a real problem a few years ago. And now, I'm sad to report it’s back.
I saw a story about how this one is booming right now and it has become a worldwide phenomenon, but most heavily in English speaking countries. Almost always, the fraud is taking place at independent ATMs - the kind that might be at a convenience store or gas station.
There are two ways to protect yourself. One – and I know this sounds weird - when you walk up to an ATM, grab the plastic slot where your card goes in. Don't vandalize the machine, but just grab the slot and rock it back and forth and see if that thing seems like its really solidly there. If its moving up and down in your hand, there's a good likelihood there's a skimmer attached to it, and you don't want to use that machine.
The second thing is, as you punch in your four-digit code, use your other hand to cover the hand you're punching in with. Because the way they're getting your code is by videotaping you. The people involved have a lot of what are called either mules or runners, who immediately go out with this plastic and just keep hitting up ATMs until they exhaust the money in the account or somebody notices and the account is shut down.
If you don't carry huge amounts of money in your checking account, institute a daily limit on ATM withdrawals. That's another way for you to limit the harm that might be caused to you by skimmer fraud.