Independent Banker - July 2018 - 23

the last few years as the industry continues to
provide more products and services in the digital
space, and fraudsters take advantage of the
digital channel's global reach. However, that does
not mean that fraud on other channels, such as
ATMs, is going away. It is simply evolving. "
Mary Ann Miller, senior director and fraud
executive advisor for NICE Actimize, says ATM
fraud is on the rise " due to the flexibility and
sophistication of the modern ATM to offer more
banking services. The ability to deposit a check at
the ATM is a favorite way for fraudsters to exploit
the fund's availability and cash it out. "
New attacks, largely physical in nature, have
been migrating to the United States from overseas,
primarily Europe. " Financial institutions
need to be aware of these attacks-from jackpotting
to the physical theft of entire machines-and
implement solutions to mitigate these risks, " says
Castanheiro. " But criminals are also using ATMs
as a preferred channel for other frauds. "
He says sophisticated attacks are targeting
customers to get around the perimeter controls
the industry has implemented. These controls
include multifactor authentication, PCI and EMV
copies an EMV chip card's magstripe and tries to
use the copy in an ATM, the issuer will know that
the card should have a chip. If the chip isn't present,
the ATM should reject it.
To get around this, thieves are shifting toward
lower-tech attacks, such as trapping a chip-enabled
payment card in the machine and retrieving
it later. Also, criminals are transmitting much of
the data they glean wirelessly, " whether by Bluetooth
or even cellular technology, " says Pascual,
" The ability to deposit
a check at the ATM
is a favorite way for
fraudsters to exploit the
fund's availability and
cash it out. "
chip cards.
" The ATM is a convenient channel for these types
of fraud, " he says, " due to the ease of access and
ability to break the traceability of fraudulent funds. "
Common scams
As a relatively small and well-secured bank, Four
Corners Community Bank considers itself lucky.
" We have been very fortunate and have not had
any successful attacks at our ATMs, " Autrey says.
" Our seven ATMs are all located at branches and
have good video coverage. That may have something
to do with why we haven't been a target. "
But ATM thieves are becoming more sophisticated.
As a result, no bank is safe from these
potential attacks. Here are a few types of attacks
on the rise.
Q Skimming
Skimming is the copying of data from a payment
card's magnetic stripe. It's not new, but the
parameters of this type of fraud are shifting as
payment technology evolves. For example, the
magstripes on EMV chip cards contain data indicating
that the card has a chip. So if a fraudster
-Mary Ann Miller,
NICE Actimize
" meaning the fraudsters never need to retrieve
the skimming device, reducing their risk and
emboldening them further. "
Over the years, criminals have developed several
variants of this attack, including overlaid
skimming devices and internal skimming devices.
Card skimming continues to be " the top threat
in the ATM environment, " according to Miller,
because newer skimming devices, like Bluetooth
skimmers, are easily and cheaply available over
the counter and can be quickly installed at ATMs.
Quick stat
614,000
Number of ATM
fraud victims in
2017, up from
403,000 in 2016
Q Hijacked terminals or " black box attacks "
Black box attacks usually involve attaching a
device to an open USB port. Rather than exploiting
software vulnerabilities, the malware mounts
a " logical " attack, using the native protocols, middleware
and communication within an ATM to
achieve a fraudulent outcome.
" While the placement of card skimmer devices
that capture and steal individual account and password
information remains the biggest ATM fraud
independentbanker.org Q 23
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Independent Banker - July 2018

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