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Home DFR Observations & Comment ATMsecurity.com Monthly Digest - Oct 2008
ATMsecurity.com Monthly Digest - Oct 2008 E-mail
Written by Douglas Russell   
Saturday, 29 November 2008 13:05

Notorious 'Chao' arrested in Turkey
FBI prevented US$70 million losses
UK ATM fraud increased by 22% according to APACS
...
Japan troubled by Funds Transfer Fraud ...

Notorious 'Chao' arrested in Turkey
Following the successful arrest in Turkey of a suspected ATM criminal known as ‘Chao’ much attention has been given to the use of SMS / text messaging to transfer details from skimming and PIN compromise devices to a remote receiver. The ATM skimming and PIN compromise devices that were apparently marketed by Chao had the capability of storing and then sending track data from 1,856 cards before manual intervention, such as to change batteries, was required. Alternatively the skimming devices could be dialled-up and data downloaded on demand. Remote access ATM skimmers and PIN compromise devices offer perpetrators additional protection from detection and apprehension in that there is no need to remain close to the ATM being targeted once the devices are installed. Chao’s ‘value added’ services also included advice on ATM target selection.

 


FBI prevented US$70 million losses

A two year international law enforcement operation spear-headed by the US Federal Bureau of Investigation (FBI) has resulted in at least 56 arrests world-wide (including Chao in Turkey) and is estimated to have prevented US$ 70 million in economic losses. The operational focus was to infiltrate an online carding forum known as Dark Market which had approximately 2,500 members. Intelligence gained from the two year operation is expected to lead to further law enforcement operations globally.


UK ATM fraud increased by 22% according to APACS
The Association of Payment and Clearing Services (APACS) in the UK released fraud statistics for the first six months of 2008 showing that UK ATM fraud increased by 22% to reach £20.8 million. Card losses in general increased 14% to $301.7 million with approximately 40% of losses taking place abroad. On-line fraud increased a dramatic 185% to £21.4 million. Since the UKs introduction of EMV Chip and PIN for use at both ATMs and Point of Sale Devices (POS) there has been a steady increase in cross border fraud where criminals compromise cards in the UK but execute the fraudulent spend in countries which do not yet have significant deployments of EMV enabled ATMs and POS terminals.

Japan troubled by Funds Transfer Fraud
A less common type of ATM fraud known as ATM Funds Transfer Fraud is a significant problem in Japan and has prompted a concerted effort from law enforcement. ATM Funds Transfer Fraud is where the victim is tricked into using the ATM to transfer funds from their account to the perpetrators account. With around 1000 incidents detected per month in Japan, victims are predominately elder consumers who believe they are helping a family member in need of emergency funds. In at least one reported incident during a police crack-down on the fraud an elderly victim refused police advice when she was observed about to transfer money via the ATM claiming that it was family business and not a matter for the police.

 

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