Thursday, January 8, 2015

Merry Christmas

How the skimming Grinch ruined my holiday.

Posted By on Thu, Jan 8, 2015 at 10:30 AM

In mid-December, I was one of about 3,000 Union First Market bank customers in the Richmond area who was a victim of debit card skimmers.

These are thieves who use inconspicuous and tiny recording devices and cameras on automatic teller machines or gas pumps to steal debit card information.

I had read in a newspaper that Union had been hit by a skimming attack but it didn’t strike close to home until I looked at my account online and saw that someone had withdrawn a couple hundred bucks from my account in McLean near Washington. I hadn’t been in that area since October.

After canceling my card over the telephone, I went to my local Union branch to have the charges covered since Union had offered to do so. Not a problem, I was told, although the next morning I checked my account and saw that I had been automatically charged a $35 overdraft fee. Back to the bank I went to get it straightened out.

That and having to wait until after Christmas to get my new debit card were big inconveniences.

What’s scary is that skimmers can be very clever about how they steal such information. They can put a bogus but remarkably realistic plastic cover over the slot where you place your card at an ATM. These pick up your card’s data while a hidden camera records what number you tap in for identification. Smart phones can also be used.

From what I’ve read, the practice of skimming hit a high point a few years ago in South America and spread to Europe. Odd, but about a year ago, American Express caught someone using my card number in London where I haven’t been in years. Officials at American Express alerted me, made good on the bogus charges, cancelled my card and got me a new one in a couple of days.

Union could learn from them. The bank never contacted me personally. If I hadn’t read the news story and checked my account I might not have known. It also took it much longer to replace my debit card than American Express.

It may be harder for skimmers to operate in the future. The finance industry is moving towards credit and debit cards that contain pertinent user information in a small chip embedded in the card rather than on familiar magnetic strips that have been in use for years. Bank of America introduced the new chip cards this fall.

Visa and MasterCard have set an Oct. 15 deadline for merchants to install point-of-sale devices that can handle the chip cards. If they don’t, according to Marketwatch, the merchants, rather than the credit card companies and banks, might be responsible for covering fraudulent charges. It costs about $1,000 to install the chip-card readers.

My case shows the obvious lesson is to maintain constant vigilance. The police and the FBI are investigating the Union incident.

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