Aussies are 'soft targets' for credit card crime, skimming

…European crime gangs are affecting our way of life. Total fraud involving cards used or issued in Australia stood at $263 million in 2008, according to the Australian Payments Clearing Authority. But this year, card fraud has exploded with the invasion of eastern European crime gangs from Romania and Bulgaria into Australia.

http://www.heraldsun.com.au
October 24, 2009

Aussies are 'soft targets' for credit card crime, skimming
Nick Tabakoff

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Surry Hills businessman Michael Souri had $30,000 raided from his account. Picture: James Elsby

WHEN Michael Souri received an answering machine message to call his bank's "security division" one evening this month, he thought he had done something wrong.

But the questioning he received when he called the division back left Souri, the owner of Sydney Lebanese restaurant institution The Prophet, even more troubled. "Have you been to Canada and Bulgaria in the last few days?", the voice on the phone asked.

Souri had been the victim of a global card-skimming fraud that raided $30,000 from his bank account in two days. His PIN and account details had been "skimmed" on a holiday to Bali two months earlier. More than 15 withdrawals in Bulgaria and Canada had been made from his debit account.

The criminals were likely Eastern European. Scarily, they had used multiple copies of his debit card to empty his account, The Daily Telegraph reports.

Souri's was far from an isolated example of how European crime gangs are affecting our way of life. Total fraud involving cards used or issued in Australia stood at $263 million in 2008, according to the Australian Payments Clearing Authority. But this year, card fraud has exploded with the invasion of eastern European crime gangs from Romania and Bulgaria into Australia.

Police say the 2009 figure will be massively higher than 2008, with more than 190 ATMs already subjected to skimming attacks so far this year. If this rate continues, 250 ATMs will have been compromised by year's end, compared with just a handful in 2008.

Sydney is at the epicentre. Police would not give up-to-date figures on ATMs skimmed. But in April it emerged that, in the March quarter, skimming devices were attached to 40 Sydney ATMs. Romanians have also been arrested locally relating to the crimes.

One of the world's top authorities in the area, Superintendent Brian Hay, boss of the Queensland fraud squad, says Australia is the "land of milk and honey" for skimmers.

And he tells of a new type of skimming tool that could soon hit Australia: "It captures people's card data and PIN codes, and transmits them by SMS to a mobile phone." This is a potential boon for card criminals, he says: "It's a sophisticated piece of kit. Now they can sacrifice the kit, and still capture the financial data."

Supt Hay has won international awards for fighting cyber-crime. But he is worried gadgets like the SMS device mean there is "no strategy for keeping up with the technical aspects of what criminal syndicates are doing with cards. It's developing too fast".

The problem is Australia is seen as the softest of targets for card crime by Eastern European gangs because of our 20th century card technology.

Top Romanian fraud officer, Inspector Elvis Tudose, says his country's crime gangs have found Australia in a big way this year because of a simple feature: the magnetic stripe on the back of cards that makes skimming far easier.

People's names, identity and card data are installed on the black strip on the back of cards. But new cards now offered by banks overseas contain a smartcard chip impregnated into the card, making skimming far harder.

"The criminals thought it would be a good idea to move their field of operations to Australia," Insp Tudose said. Eastern European criminals make multiple card copies and withdraw money using customer PINs.

Supt Hay says this allows criminals to be quick and deadly in cleaning out accounts: sometimes allowing tens of thousands of dollars to disappear in hours across continents. Criminals tend to use cards away from countries where they are stolen. "And the more trans-national the crime, the more difficult for police, given the lack of cross-border arrangements," Supt Hay says.

Just how vulnerable we are became clearer this week, when The Daily Telegraph revealed McDonald's was overhauling security of its EFTPOS network at 730 stores across Australia.

A scam saw handheld EFTPOS machines at McDonald's outlets in Perth removed, and apparently replaced with bogus versions. WA police said McDonald's workers had most likely been distracted, presumably while filling orders. The crooks then needed just seconds to switch devices over.

The bogus machines probably had a chip fitted inside allowing transmission of banking details to criminals. Money was then withdrawn offshore. McDonald's says the crime has so far been quarantined to its WA outlets. But the WA fraud has police on high alert.

But the scams continue. In April, Northern Beaches resident Gina Berney noticed her bank balance was depleted shortly after her local Commonwealth Bank ATM had been skimmed. An official told her there had been a €450 ($740) withdrawal in Italy. "It spooked me," she says.

She is now suspicious in her banking habits - changing her PIN "once a fortnight" and fiddling with ATMs to see "if the card slot is loose". She believes society's easy money mentality has left people vulnerable, with technology benefiting criminals. "One day we'll come full circle, and do all our financial transactions face-to-face - with people," she says.

Supt Hay is more hopeful: "There has to be a police and private sector collaboration. But if we all share information, we can treat this globally."

http://www.heraldsun.com.au/money/banking/aussies-are-soft-targets-for-credit-card-crime-skimming/story-e6frfh5o-1225790742826


Risks: Bank card skimming fraud, Fraud, Trust, Identity theft, Weak security costs public millions $, Organized crime, Australia, 20091024 Aussies are

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