Posted by: Editor LNAV | August 26, 2008

ATM frauds getting more sophisticated: Experts

Neelabh Srivastava, Press Trust Of India / New Delhi August 24, 2008, 17:55 IST

Economic frauds carried out through bank Automated Teller Machines (ATM’s) are now getting sophisticated and trendy with both technical and human expertise employed to siphon-off the crisped currency from their chests.

Anti-fraud experts say that India, with its huge number of ATM’s coming up every other day, is witnessing wide scale effects of the ATM fraud phenomenon which was lately prevalent in foreign countries.

“The problem of ATM frauds is global in nature and its ramifications have been felt in India as well. It is a big threat and it requires a coordinated and cooperative action on the part of all the stakeholders”, Pravin Dalal, cyber security expert said.

ATM frauds are executed by techniques like wire tapping, replicating the digital signature of the card, getting authentic personal data at fake data call centres, tampering ATM slots by rigging, phishing through e-mail accounts and fixing hidden cameras at vantage points inside ATM installations to steal the secret PIN number of the customers. Fraudsters use special devices like skimmers, duplicate ATMs, to withdraw stacks of money from ATMs.

“Direct access to the bank account through the ATM card will not cause huge per client losses but collectively in the coming days it can be a huge figure,” Mayur Joshi, head of India Forensic agency, a private firm, said.

In the new and emerging trends relating to ATM frauds, Joshi describes an incident. “In a recent case investigated by my team in Nagpur region, ATM cards belonging to new applicants were dispachted through official couriers at the residences of the victims after their applications were sanctioned by the bank authorities. “Interestingly, the ATM cards which belonged to applicants whose addresses were either not traced or were absent during delivery, were received by the bank officials and after getting the possession of the same cards they started withdrawing the money from the accounts of the depositors of the bank,” Joshi said.

“Banks never ask for personal information of their patrons over the e-mail, through post or by sending executives. Customers should very carefully mention their user ID’s, credit card numbers and passwords under their own watchful eyes”, a spokesperson for a leading national bank said.

Banks on their part have installed various security fixtures like installing CCTV cameras and deploying round- the-clock static guard at the ATM’s to keep a check on suspicious persons, he added. Various banks have also pasted information security pledges and detailed pointers inside ATM complexes in order to spread the message of safe ATM usage, a banker said.

“The IT Act, 2000 does not contain any specific provisions regarding the same and the traditional law of IPC, 1860 also cannot be relied solely and independently to tackle this problem,” Dalal said.

He said that banks should opt for mechanisms like designated time, Microchip technology, Biometric tokens, ATM Monitoring, Customised softwares, and Customer motivation to curb this menacing fraud.

Writer: Neelabh Srivastava of Press Trust Of India

Source: http://www.business-standard.com/india/storypage.php?tp=on&autono=45219

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