ATM Fraud Increases Identity Theft Risk

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Robert Siciliano Identity Theft Expert

A spate of recent news reports highlight growing ATM fraud. Law enforcement in New York City reported a gang had stolen $500,000 from bank accounts via ATM skimming. They installed cameras and skimming devices on the machines, and recorded the magnetic strips and the PIN numbers.

A recent survey points towards ATM fraud rising 5-9 percent. Seventy percent of those poled experienced a jump between 2007 and 2008. Many of the large data breaches that have occurred over the past few years may have contributed to the fraud.

It’s simple enough to hack into a database and compromise cards and pins. It’s even easier to affix hardware to the face of an ATM machine and do the same. Once the data is compromised the identity thieves clone cards and turn the data into cash as quickly.

Bankinfosecurity.com recently published “7 Growing Threats to Financial Institutions”. This post is a play on that; “7 Growing Threats to You”

#1 Skimming; Hardware readily available online that is attached to the face of an ATM records user card information and pin codes. In this case you may still be able to perform a transaction.

#2 Ghost ATMs; A card reader is blocked off and replaced with hardware that supersedes the machine and records all your data without allowing a transaction. The machine reads “Can’t complete transaction”.

#3 Dummy ATMs; In some cases an ATM is bought off of eBay (do a search) or elsewhere and installed anywhere there is foot traffic. The machine is set up for one purpose; read data. The machine might be powered by car batteries or plugged in the nearest outlet.

#4 Ram Raids; ATMs built into a wall or stand alone are being rammed by a truck and/or wrapped with chain and pulled out then loaded onto a truck. Once removed the thieves blow torch the machine taking the cash. This is a hot topic in Mexican banks, buy certainly happens everywhere. A bank would be smart to install battery backed GPS in any machine.

#5 PIN ID’s; Sophisticated criminal hackers break into a database or skim magnetic strips. They then go to an online banking site with a hacking software that plugs in various well known PINs. These PINs might be consecutive numbers, peoples names, pets names, birthdates, or other various simple pass phrases people use. When it finds a match it gives the criminal access to your account.

#6 Automated PIN Changes; Criminals go through the banks telephone banking system to change the customers PIN. They may try to change the customers ANI (Automatic Number Identification) is a system utilized by telephone companies to identify the DN (Directory Number) of a caller. This might be accomplished via “Caller ID Spoofing”. They use publicly available data on the card holder such as name, card account number and last four digits of the social security number to “verify” them as the banks customer.

#7 SMS Attacks; AKA Smishing or Phexting – phish texting. Customers receive a text from a bank on their smartphone requesting login information.

#8 Malware or Malicious Software; Researchers found a virus that specifically infects ATMs and takes over the machine logging card numbers and pins.

How to protect yourself;

First and foremost; Pay attention to your statements every two weeks. Refute unauthorized transactions within a 30-60 day time frame.

1. Pay close attention to everything you do at an ATM. Look for “red flags”, anything out of place. If your card sticks, odd looking configurations on the ATM, wires, two sided tape.
2. Use strong PINs, uppercase lower case, alpha and numeric online and when possible at an ATM and for telephone banking.
3. Don’t reply to phishing or phexting emails. Just hit delete.
4. Don’t just use “any” ATM. Choose ATMs at locations that are “more secure” than in the middle of nowhere.
5. Make sure your McAfee anti-virus is up to date.
6. Invest in Intelius identity theft protection and prevention. Because when all else fails its good to have someone watching your back.

Robert Siciliano Identity Theft Speaker discussing ATM skimming

Identity Theft Expert; Fake IDs are as easy as 1,2,3

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Robert Siciliano Identity Theft Expert

Do an online search for “fake ids” and you’ll be amazed to discover how easy it can be to obtain an ID allowing you to pose as someone else. Or how easy it can be for someone else to obtain an ID that will allow him or her to pose as you. Some websites peddle poor quality cards, others offer excellent quality, and many websites are simply scams.

The fact is, our existing identification systems are insufficiently secure, and our identifying documents are easily copied. Anyone with a computer, scanner and printer can recreate an ID. Outdated systems exasperate the problem by making it too easy to obtain a real ID at the DMV, with either legitimate or falsified information.

Another glitch is the potential for individuals to completely alter their appearances. Men with facial hair can wreak havoc on the current system. This is sometimes done as a prank. In other cases, the individual is attempting to subvert the system to maintain a degree of anonymity. New technologies, such as facial recognition, should eventually resolve some of these problems, but they are still years away from being fully implemented.

In Indianapolis, Indiana, a man was able to obtain six different IDs. He accomplished this by visiting various different registries throughout the state and using borrowed names and stolen information. He obtained job applicant data from a failed body shop business he had owned. He used the false identities to open checking accounts at multiple banks and write fraudulent checks to himself.  He was caught while applying for his seventh ID, thanks to facial recognition software. But it is disturbing to know that he was able to acquire six different identities, all stolen from real people, without detection. It was a bank employee who eventually noticed that he had two different bank accounts under two different names. If the man hadn’t been so greedy, he would have gotten away with it.

In Indianapolis and other registries the daily photos are compared to millions of others already on file. The system constantly scans the data and presents cases that might match, requiring further investigation by registry employees.

Some of the requirements of improving facial recognition include not smiling for your picture or smile as long as you keep your lips together. Other requirements meant to aid the facial recognition software include keeping your head upright (not tilted), not wearing eyeglasses in the photo, not wearing head coverings, and keeping your hair from obscuring your forehead, eyebrows, eyes, or ears.

The fact is, identity theft is a big problem due to a systematic lack of effective identification and is going to continue to be a problem until further notice. In the meantime it is up to you to protect yourself. The best defense from new account fraud is identity theft protection.

1. Get a credit freeze. Go online now and search “credit freeze” or “security freeze” and go to consumersunion.org and follow the steps for the state you live in. This is an absolutely necessary tool to secure your credit. In most cases it prevents new accounts from being opened in your name.

2. Invest in Intelius Identity Protect. While not all forms of identity theft can be prevented, you can effectively manage your personal identifying information by knowing what’s buzzing out there in regards to YOU.
Includes;

Personal Identity Profile – Find out if you’re at risk for identity theft with a detailed report of your identity information, including a current credit report, address history, aliases, and more.

24/7 Identity Monitoring and Alerts – Prevent identity theft with automatic monitoring that scans billions of public records daily and alerts you to suspicious activity.

Identity Recovery Assistance – Let professionals help you recover your identity if you ever become a victim of identity theft.

Robert Siciliano Identity Theft Speaker discussing identity theft

Judge Rules; It is legal to post Social Security numbers on Web sites

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Robert Siciliano Identity Theft Expert

B.J. Ostergren is a proud Virginian. She’s known as “The Virginia Watchdog,” but I like to call her “The Pit Bull of Personal Privacy.” She is relentless in her efforts to protect citizens’ privacy, and she is primarily concerned with the posting of personal information online. So in order to make this point, she finds politicians’ personal information on their own states’ websites, and republishes that information online.

Publicly appointed government employees known as Clerks of Courts, County Clerks or Registrars are responsible for handling and managing public records, including birth, death, marriage, court, property and business filings for municipalities. Every state, city and town has its own set of regulations determining how data is collected and made available to the public.

The Privacy Act of 1974 is a federal law that establishes a code of fair information practices governing the collection, maintenance, use, and dissemination of personally identifiable information about individuals that is maintained in systems of records by federal agencies.

Over the years, many have interpreted this law to allow public information, including Social Security numbers, to be posted online. I’ve seen Social Security numbers for Jeb Bush, Colin Powell, former CIA Director Porter Goss, Troy Aiken, and Donald Trump, all published on the Internet.

Years ago, B.J. discovered that several states, including her home state of Virginia, were posting our records online, and she immediately saw how this could contribute to identity theft. She has downloaded as many as 22,000 Social Security numbers from deeds, mortgages, tax liens from the websites of circuit courts, registers of deeds and secretaries of state. She made a concerted effort to inform each agency that what they were doing was unethical, at the very least, and possibly even criminal. But she was often rebuked. That’s when she decided to fight back. When government agencies stopped listening, she started posting politicians’ personal information on her own website, “The Virginia Watchdog.” This certainly attracted the attention of officials, but it also created a backlash against her.

Some states resolved the issue by redacting the Social Security numbers, but Virginia did not. B.J. persisted in informing them of the problem and, as the Richmond Times Dispatch put it, “the state decided that the person who brought the problem to their attention was the problem.”

A 2008 Virgina state law prohibited disseminating information taken from public records, and thus, prohibited B.J. from posting publicly available information on her own website. So legally, it was okay for the County Clerk to do it, but nobody else was allowed. U.S. District Court Judge Robert E. Payne recently ruled that this 2008 state law is a violation of First Amendment rights. It’s a win for B.J., but this doesn’t resolve the initial privacy issue.

So how does this impact you? This means that while you can do everything possible to protect yourself from fraud and identity theft, your local government may be circumventing your security efforts by posting your personal data online. B.J.’s fight has led to the resolution of some issues and prompted some states to redact data, but the battle is far from over.

Visit B.J.’s site, The Virginia Watchdog, to become more informed about one woman’s quest to point out what’s wrong and to fight for what’s right.

Next, protecting yourself from new account fraud requires a credit freeze, or setting up your own fraud alerts. This provides an extra layer of protection. In most cases it prevents the opening of new credit.

Consider making an investment in Intelius Identity Protect. Because when all else fails you’ll have someone watching your back. Includes a Free Credit Report, SSN monitoring, Credit & Debit Card monitoring, Bank Account monitoring, Email fraud alerts, Public Records Monitoring, Customizable “Watch List”, $25,000 in ID theft insurance, Junk Mail OptOut and Credit Card Offer OptOut.

Robert Siciliano Identity Theft Speaker discussing availability of Social Security numbers

Identity Theft Credit Card Security

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Robert Siciliano Identity Theft Expert

Credit card fraud comes in two different flavors: account takeover and new account fraud. Account takeover occurs when the identity thief gains access to your credit or debit card number through criminal hacking, dumpster diving, ATM skimming, or perhaps you simply hand it over when paying at a store or restaurant. Technically, account takeover is the most prevalent form of identity theft. I’ve always viewed it as simple credit card fraud, rather than “identity theft” in its truest sense.

New account fraud, as it relates to credit cards, occurs when someone gains access to your personal identifying information, including your name, address and, most importantly, your Social Security number. With this data, a thief can open a new account and have the card sent to a different address. This is true identity theft. Once the identity thief receives the new card, he or she maxes it out and doesn’t pay the bill. Over time, the creditors track down the victim, blame him or her for the unpaid bills, and demand the owed funds. New account fraud destroys the victim’s credit and is a mess to clean up.

Victims of account takeover are likely to discover the fraud in numerous ways. They may notice suspicious charges on a credit card statement, or the credit card company may notice charges that seem unusual in the context of the victim’s established spending habits. Credit card companies have anomaly detection software that monitors credit card transactions for red flags. For example, if you hand your credit card to a gas station attendant in Boston at noon, and then a card present purchase is made from a tiny village in Romania one hour later, a red flag is raised. Common sense says you can’t possibly get from Boston to Romania in one hour. The software knows this.

Victims of account takeover only wind up paying the fraudulent charges if they don’t detect and report the crime within 60 days. A 6o day window covers two billing cycles, which should be enough for most account-conscious consumers who keep an eye on their spending. During that time, you are covered by a “zero liability policy,” which was invented by credit card companies to reduce fears of online fraud. Under this policy, the cardholder may be responsible for up to $50.00 in charges, but most banks extend the coverage to charges under $50.00. After 60 days, though, you are out of luck. So pay attention to your statements. As long as you do, account takeover should not hurt you financially.

But new account fraud is another story entirely – one that can and will hurt you if you don’t protect yourself. You may not be held financially responsible for the charges themselves, but you will pay in time, and time is money. In some cases you may pay lawyers or private investigators, or you may need to take time off from work, depending on how dire your credit situation becomes. Identity theft victims have been denied credit due to the unpaid debts in their names, and have missed opportunities to purchase homes as a result.

Protecting yourself from account takeover is relatively easy. Simply pay attention to your statements every month and refute unauthorized charges immediately. I check my charges online once every two weeks. If I’m traveling extensively, especially out of the country, I let the credit card company know ahead of time, so they won’t shut down my card while I’m on the road.

Protecting yourself from new account fraud requires more effort. You can attempt to protect your own identity, by getting yourself a credit freeze, or setting up your own fraud alerts. There are pros and cons to each.

Robert Siciliano Identity Theft Speaker discussing identity theft hackers

Requests For Social Security Numbers Leads to Identity Theft

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Robert Siciliano Identity Theft Expert

A patient at a Washington state medical clinic was asked for his Social Security number numerous times. Many of us have endured this familiar process. Considering the recent buzz about identity theft, this patient became concerned about releasing his own sensitive personal data, and requested that the facility remove his Social Security number from their records. The clinic refused, the patient put up a stink, and was ultimately ejected from the facility. The clinic considered his request unreasonable, and a violation of their rules and regulations. So, who’s right and who’s wrong in this scenario?

One Saturday afternoon, years ago, my spouse and I went to a major chain that rents videos. Without naming them, let’s just say they rent some block buster movies. The account was under my wife’s name, but she didn’t have her card with her that day. Upon checkout, the pimply faced 17-year-old clerk said, “No problem,” and asked for her Social Security number, which appeared on the screen in front of him. I freaked out and was ejected from the store. So, who’s right and who’s wrong?

In both cases, the customer is wrong. That may not be the answer you were expecting. I was wrong and the patient was wrong.

In general, routine information is collected for all hospital patients, including the patient’s name, address, date of birth, Social Security number, gender and other specific information that helps them verify the individual’s identity, as well as insurance enrollment and coverage data. And due to federally mandated laws like HIPAA, they are careful to maintain confidentiality of all patient information in their systems.

Corporations such as banks, credit card companies, automobile dealers, retailers and even video rental stores who grant credit in any form are going to ask for your name, address, date of birth, Social Security number and other specific information that helps them verify your identity and do a quick credit check to determine their risk level in granting you credit.

The Social Security Administration says, “Show your card to your employer when you start a job so your records are correct. Provide your Social Security number to your financial institution(s) for tax reporting purposes. Keep your card and any other document that shows your Social Security number on it in a safe place. DO NOT routinely carry your card or other documents that display your number.” But beyond that they have no advice and frankly, no authority.

Over the past fifty years, the Social Security number has become our de facto national ID. While originally developed and required for Social Security benefits, “functionality creep” occurred. Functionality creep occurs when an item, process, or procedure designed for a specific purpose ends up serving another purpose, which it was never intended to perform.

Here we are decades later, and the Social Security number is the key to the kingdom. Anyone who accesses your number can impersonate you in a hospital or bank. So what do you do when asked for your Social Security number? Many people are refusing to give it out and quickly discovering that this creates a number of hurdles they have to overcome in order to obtain services. Most are often denied that service, and from what I gather, there is nothing illegal about any entity refusing service. Most organizations stipulate access to this data in their “Terms of Service” that you must sign in order to do business with them. They acquire this data in order to protect themselves. By making a concerted effort to verify the identities of their customers, they establish a degree of accountability. Otherwise, anyone could pose as anyone else without consequence.

So where does this leave us? I have previously discussed “Identity Proofing,” and how flawed our identification systems are, and how we might be able to tighten up the system. But we have a long way to go before we are all securely and effectively identified. So, in the meantime, we have to play with the cards we are dealt in order to participate in society and partake in the various services it offers. So, for the time being, you’re going to have to continue giving up your Social Security number.

I give up mine often. I don’t like it, but I do things to protect myself, or at least reduce my vulnerability:

How to protect yourself;

  • You can refuse to give your Social Security number out. This may lead to a denial of service or a request that you, the customer, jump through a series of inconvenient hoops in order to be granted services. When faced with either option, most people throw their arms in the air and give out their Social Security number.
  • You can invest in identity theft protection.
  • You can attempt to protect your own identity, by getting yourself a credit freeze, or setting up your own fraud alerts. You can use Google news alerts to sweep the net and take precautions to prevent social media identity theft.
  • Protect your PC. Regardless of what others do with your Social Security number, you still have to protect the data you have immediate control over. Make sure to invest in Internet security software.

Robert Siciliano, identity theft speaker, discusses the ubiquitous use of Social Security numbers.

What have you done in the past when asked for your SSN? Did you refuse? What happened?

Identity Theft Ring Pickpockets Caught by Feds

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Identity Theft Expert Robert Siciliano

If there were a “criminal hall of fame,” with an award bestowed on the “coolest” criminal, it would have to be a pickpocket. Pickpockets are sneaky, devilish creatures who function exactly one degree below the radar.

Pickpockets whisper through society, undetected and undeterred. They are subtle and brazen at the same time. They are  like a bed bugs, crawling on you and injecting a numbing venom that prevents you from detecting their bite until it’s much to late. They aren’t violent like a drug crazed mugger or confrontational like a stick up robber. They have much more gumption than any criminal hacker because they don’t hide under the anonymity of the Internet.

One second is all a pickpocket needs. A brief diversion, a quick move, and before you can take a breath, your wallet is gone.

Pickpocketing is one of the oldest criminal professions, and is still very prevalent in Europe. Their target? Clueless Americans. Americans just aren’t as aware of pickpockets, since it isn’t as prevalent here.

One victim’s story: “My wife and I were at a Paris Metro station where the loudspeakers were blaring, ‘WARNING. THERE ARE PICKPOCKETS PRESENT AT THIS STATION.’ We got on the crowded subway. A woman stayed half on and half off, blocking the door. At the same time, another woman was bumping against me, indicating that she needed to get off. She got past me and she and her friend exited the train, allowing the door to close. As she did, I realized that my cash (about $120) was gone from my pocket. As we pulled away, I watched the two women at the station, smiling and waving at me.”

Pickpockets’ greatest advantage is the fact that most people don’t believe it can happen to them. Including me.

Years ago, I met this cat named Gene Turner at a convention. A great guy who has the skills of a real pickpocket, but uses his abilities to inform, educate and entertain people. I told him to get Pickpocket.com, which he did. I should get a slice of that action! Real nice guy, very personable. He introduced himself to me by – without me knowing – taking my watch off my left wrist. Then asked me what time it was. I looked at my left wrist, no watch. He pointed to my right arm, where he re-fastened it. Freaked me out.

Gene says, “Personally, I get ‘caught’ maybe once out of a thousand times when I’m lifting a watch. And usually it’s either a really difficult watch or I’m taking it from the same person for the third or fourth time. I have always said a good pickpocket could pick me clean and I would never feel it. Even the best multi-tasker can be distracted, and it only takes a split second of distraction to become a victim. I have lifted watches from and put watches on many magicians, security people and yes, even other pickpockets, without their knowledge.”

Wired reports that pickpockets have upped the ante: “Feds Swoop In on Nationwide Pickpocket, I.D. Theft Ring.” The suspects, using a novel and high-tech strategy, allegedly stole the identities and bank account information from victims nationwide through pickpocketing and other means. The ring allegedly traveled around the country to crowded events, targeting sports fans in particular. Often, they worked in teams, in which one person distracts the victim and the other lifts the victim’s wallet.

How to protect yourself:

1. Be wary of someone yelling, “There’s a pickpocket in the crowd.”

Gene says, “I use this ploy a lot in my show. When people find out that I can pick pockets, the men check for their wallets and the women will check for their jewelry in the order of value – most expensive first. Their actions clue me as to exactly where the wallets and valuable jewelry are located.”

A man in a business suit has four pants pockets and six to eight pockets in the jacket. His wallet, cash and credit cards could be in any one of ten or more pockets. Pickpockets don’t usually have time to search all ten, but if they see you check your pocket when you read the sign, they now know the exact location. If you think there are pickpockets around or you see a sign, don’t be obvious about checking for your wallet or valuables.

2. Don’t display money or valuables in public.

Flashing your money will get you more attention than you want. Pickpockets will notice where you stash the cash and one bump later, you’ll be left with an empty pocket.

3. Be aware of your surroundings.

Especially in crowded places, bumps, commotions, and aggressive people are the typical distractions pickpockets use. Sometimes a person will fall down, drop something or appear to be ill, and we rush in to help. That’s great and I recommend it, but it may be a diversion. If you’re helping a stranger, make sure someone you trust is watching your valuables. Sidewalks, malls, bus terminals, airports, train stations, in any type of crowd it is extremely important to be aware of your surroundings. Pickpockets are counting on you paying attention to everything except for your wallet or purse.

4. Don’t carry valuables in a backpack or fanny pack.

Anyone can reach into a backpack without you seeing or feeling. Fanny packs, if worn, should only be worn in front. Keep in mind that that won’t prevent a thief from undoing it or slashing the belt and getting away with it. If you do wear a fanny pack, make sure the buckle is near the pouch in front, so a pickpocket would have a more difficult time getting to the latch without your knowledge. It is not uncommon for a pickpocket to use a razor blade to slice through a bag and reach in.

5. Thin out your wallet.

Ultimately, they may still get your wallet. And when they do, you need to be prepared to respond to the fallout. The best protection is to not carry anything of value. There is no need to carry documents containing Social Security numbers, passwords, account numbers, birth certificates or anything that could lead to new account fraud. I carry a drivers license, credit card and a Costco card. Think of it this way: if your wallet were lost or stolen, would you feel like throwing up? If so, you have too much stuff in there.

6. Make copies.

For those of you that have to carry lots of stuff for various reasons, please make a photocopy, front and back, of every document in your wallet. Keep those photocopies in a secure place. If your wallet goes missing, you will have everything you need to close the existing cards and get new ones. Plus, it doesn’t hurt as much when you can see a copy of the missing cards.

7. Use anti-check washing pens.

Wallets often contain checkbooks. Check fraud is a billion dollar problem. Check washing occurs when criminals use nail polish remover to scrub out the payee and dollar amount, and rewrite checks to themselves for increased  amounts. With a uni-ball anti-check washing gel pen, you can prevent your checks from being washed.

8. Protect your identity
Invest in intelius identity theft protection and prevention services. Even if your wallet is squeaky clean, your data may be found in your banks dumpster or be hacked. Which is why you also must protect your computer by having the latest McAfee anti-virus and spyware protection.

Robert Siciliano Identity Theft Speaker discussing identity theft ring busted

ATM Skimmer Defeated By Customer

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Identity Theft Expert Robert Siciliano

Its not often that I get to report on the victim becoming the victor. It’s nice to see the good guys win one.

I met a charismatic gent on FOX and Friends named Sean Seibel. Sean has a unique job title at Microsoft: User Experience Evangelist. Sean’s job is to be on top of what’s new and what’s next in technology, in the next 5-7 years. He’s a futurist. He and I spoke in the green room of the show before we appeared together on a segment regarding ATM skimming.

ATM skimming often results in forms of identity theft, credit card fraud or bank fraud.

To be a User Experience Evangelist requires a certain vision, insight and the ability to go beyond what’s current or obvious. Sean proved his ability to see “more” by trumping a gang of identity thieves who set out to steal millions from ATMs but “only” got away with $500,000.

Sean stopped at an ATM to get some cash to pay his barber. When he inserted his ATM card in the machine, he noticed a bit of resistance. Most people wouldn’t think twice about this. But Sean doesn’t think like most people. Then the screen said the machine was unable to read his card so he tried again. The second time, the machine gave him an error message. Before he tried again, he thought about a report he had heard about devices that fraudsters attach to the outside of card readers on ATM machines and wondered if that was the source of his problem.

He says, “I’m looking at the thing and thinking, this can’t be. No way. There are all these stories and myths about it, but I actually found one in the wild.”

Sean was face to face with an ATM skimmer, one that he had just swiped his card through. His heart started pounding. Adrenalin was rushing through his body. He was concerned, not just that he might be scammed, but that criminals might be very close by, maybe even behind him or watching him. However, that did not deter him.

Sean says, “I tried to pull on the green plastic surrounding the card slot and found that it peeled right off.” This plastic ATM skimmer had an SD card built into it to store all the stolen data. Sean went into the bank and notified the branch manager, who had never seen an ATM skimmer and didn’t know what to do. She took the skimmer and thanked Sean.

Then Sean remembered, from numerous reports about ATM skimming, that there are usually 2 parts to the ATM skimmer. One is the skimming device itself, the second is a micro-camera placed somewhere on the machine, where it 1arecords the user’s PIN. The camera is often installed in a false brochure holder that taped to the ATM. In this case, it was behind a small mirror that alerts the ATM user to beware of “shoulder surfers.”

Sean went back to the still operational ATM, where people were waiting in line for their cash, and noticed a tiny video camera behind an extra mirror attached to the machine, positioned right over the key pad where it could record user’s PINs. Not being a bank employee and not wanting to alarm any of the people iwaiting, he actually got in line, waited his turn (knowing that the skimmer was gone and nobody was in danger) and pulled the camera off the ATM.

He brought the camera to the bank manager, who replied by saying, “Maybe we should shut 2b*that machine down, huh?” Sean said, “I think that’s a good idea.” The bank manager contacted bank security, shut down the machine and alerted other area banks. The identity thieves netted $500,000 from their scam, rather than the millions they might have stolen had Sean Seibel not foiled their operation.

Bank branch manager…ZERO
Identity Thieves……….$500,000
Sean Seibel foiling their operation and becoming a hero to many….Priceless.

Some great tips from Marite Ferrero, of CardSwitch Technology:

  • Skimming has been and will continue to be the most common type of ATM-related fraud.
  • Criminals attach skimming devices over card slots on ATMs to steal data as the machine reads the card’s magnetic strip.
  • Hidden cameras record victims typing in their PIN codes.
  • More sophisticated criminals use wireless keypad overlays, which transmit PINs to a nearby laptop, instead 3bof cameras.
  • The U.S. Secret Service estimates that annual losses from ATM skimming total about $1 billion each year, or $350,000 a day.
  • Bank ATMs are more vulnerable than standalone ATMs.
  • Standalone ATMs in grocery stores or on the street use technology that encrypts the PIN pad, making them more difficult for criminals to hack.
  • Standalone ATMs are often positioned near the watchful eye of cashiers or store owners, so it’s harder to install skimmers without being caught.
  • Bank ATMs are also more highly trafficked, which means a bigger potential payoff for the criminals.

Also, invest in identity theft protection and make to update your PC’s McAfee internet security software.

Identity theft expert Robert Siciliano discusses ATM skimming.

P2P on Your PC Equals Identity Theft

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Robert Siciliano Identity Theft Speaker

Peer to peer file sharing is a great technology used to share data over peer networks.  It’s also great software to get hacked.

The House Committee on Oversight and Government Reform is responding to reports that peer to peer file sharing allows Internet users to access other P2P users’ most important files, including bank records, tax files, health records, and passwords. This is the same P2P software that allows users to download pirated music, movies and software.

What’s interesting is that they didn’t already realize this was going on. Most of the committee members probably have kids, and their own home PCs probably have P2P software installed.

An academic from Dartmouth College found that he was able to obtain tens of thousands of medical files using P2P software. In my own research, I have uncovered tax returns, student loan applications, credit reports and Social Security numbers. I’ve found family rosters which include usernames, passwords and Social Security numbers for entire family. I’ve found Christmas lists, love letters, private photos and videos (naughty ones, too) and just about anything else that can be saved as a digital file.

Installing P2P software allows anyone, including criminal hackers, to access your data. This can result in data breaches, credit card fraud and identity theft. This is the easiest and, frankly, the most fun kind of hacking. I’ve seen reports of numerous government agencies, drug companies, mortgage brokers and others discovering P2P software on their networks after personal data was leaked.

Blueprints for President Obama’s private helicopters were recently compromised because a Maryland-based defense contractor’s P2P software had leaked them to the wild, wild web.

The House Committee on Oversight and Government Reform sent letters to the Attorney General and FTC Chairman, asking what the Department of Justice is doing to prevent the illegal use of P2P. Which is kind of ridiculous, because it’s not illegal to use P2P programs. Even if it were made illegal, P2P file sharing is a wild animal that can’t be tamed.

The letter also asks what the government is doing to protect its citizens. Okay. I’ve sat with both the FTC and the DoJ. These are not dumb people. I‘ve been very impressed by how smart they are. They know what they are doing and they see the major issues we face. But they are not in a position to prevent an Internet user from installing a free, widely accessible software, and subsequently being stupid when setting it up and unintentionally sharing their C-drive with the world. No government intervention can prevent this. The House Committee on Oversight and Government Reform should focus more on educating the public about the use of P2P file sharing.

Politicians are most likely being lobbied and funded by the recording and motion picture industries to put pressure on the providers of such software. Letters and government noise will not do anything to stop file sharing. While there have been plenty of witch hunts leading to prosecutorial victories, the public will always be vulnerable. It is up to us, as individuals, to protect ourselves.

  • Don’t install P2P software on your computer.
  • If you aren’t sure whether a family member or employee has installed P2P software, check to see whether anything unfamiliar has been installed. A look at your “All Programs Menu” will show nearly every program on your computer. If you find an unfamiliar program, do an online search to see what it is you’ve found.
  • Set administrative privileges to prevent the installation of new software without your knowledge.
  • If you must use P2P software, be sure that you don’t share your hard drive’s data. When you install and configure the software, don’t let the P2P program select data for you.

Robert Siciliano Identity Theft Speaker video hacking P2P getting lots of fun data.

E-banking just got less secure

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Robert Siciliano Identity Theft Speaker

There is no end to the ingenuity of the criminal hacker. They’ve figured out how to hack debit card PINS. Debit cards are linked directly to our checking accounts, which makes them tasty treats for criminal hackers.

At an ATM or cash register, most debit card users are blissfully unaware of what occurs when they swipe their cards and enter their pin numbers. A magical mystery takes place and we get to walk away with our new purchase, simply by swiping a card and tapping a few keys. The money magically disappears from our account and we celebrate by eating the Twinkie we just bought.

Whether you’re swiping your debit card at an ATM or in a store or restaurant, the process is similar. The user swipes his or her card and types in the pin number. The data is verified by a 3rd party payment processor or, in some cases, by a bank, over telephone lines or the Internet. Once the information has been validated and the payment processor confirms that the required funds exist, the money is moved from the user’s account to the merchant’s account, or is dispensed in cash.

The convenience of debit cards has led to global popularity that vastly exceeds that of handwritten checks, all the way into 3rd world countries.

We’ve known for some time that low-tech skimming at ATMs and gas pumps has been a point of compromise. Now, Wired reports that the transaction itself puts your PIN number at risk. Academics discovered this flaw years ago, but didn’t think it would be possible to execute in the field. Criminal hackers, however, have come up with the holy grail of hacks, stealing large amounts of encrypted and unencrypted debit card and pin numbers. And they have figured a way to crack the encryption codes.

The first signs of PIN tampering were recognized when investigators studied the processes of the 11 criminals who were caught after the TJX data breach. That breach involved 45 million credit and debit cards. The crime ring needed PIN codes to turn that data into cash. An investigation into this breach reported that the hacks resulted in “more targeted, cutting-edge, complex, and clever cyber crime attacks than seen in previous years.”

This revelation has some saying that the only cure for this type of hack is a complete overhaul to the payment processing system.

The compromise occurs in a device called a hardware security module (HSM), which sits on bank networks. PIN numbers pass through this device on their way to the card issuer. The module is tamper-resistant and provides a secure environment for encryption and decryption for PINs and card numbers. Criminal hackers are accessing HSMs and tricking them into providing the decrypting data. They are installing malware called “memory scrapers,” which capture the unencrypted data and use the hacked system to store it.

The PCI Security Standards Council, a self regulating body that oversees much of what occurs regarding payment card transaction, said they would begin testing HSMs. Bob Russo, general manager of the global standards body, said that the council’s testing of the devices would “focus specifically on security properties that are critical to the payment system.”

I don’t own a debit card and never have and never will. Simply put, if my debit card were hacked, that money would be coming directly from my bank account. A compromised ATM or point of sale transaction often fails to exhibit evidence of hacking. This means that I’d have to go through the arduous process of convincing my bank that it wasn’t me who withdrew thousands of dollars from my account. Whereas if a credit card is compromised, the zero-liability guarantee kicks in and I’m cured much more quickly.

Your ultimate responsibility here is to check your statements very closely and look for unauthorized activity. Read your statements online biweekly as opposed to relying solely on your monthly paper statement, and refute unauthorized charges immediately. Consider using a credit card instead of a debit card.

While this type of fraud is generally out of your control it’s still imperative you invest in internet security software such as McAfee and consider identity theft protection.

Identity Theft Expert discussing flawed card transactions

I’m excited to work with uni-ball in 2009 in a partnership to help raise awareness about the growing threat of identity theft and provide tips for protecting yourself. Check out uniball-na.com for more information.

Credit card fraud is Americans number one concern

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Identity theft Expert Robert Siciliano

A recent study conducted by the Unisys Corporation shows that identity theft as it pertains to credit card fraud is Americans’ number one concern.

When people ask me, “How do I protect myself from credit card fraud?” I tell them, “Cancel the card, or never use it.” Because that’s the only way.

Personal security (as it pertains to violence) and national security have always been a concern. However, this new study shows that people are more concerned with fraud, and the risk of having their savings depleted by scammers. Not so hard to believe, what with the number of data breaches, and the Madoffs of the world fleecing their unsuspecting investors.

75% of Americans feel that the recession has increased their chances of being victimized by criminal hackers and thieves. Most are also concerned their “private” information on a corporate or bank network may be compromised.

FBI’s Internet Crime Complaint Center’s 2008 Annual Report determined that online fraud increased by 33.1% last year. Dollar losses resulting from online fraud increased to $265 million.

Overall, these concerns are valid, due to flaws in the system of issuing credit that facilitate new account fraud. Furthermore, account takeover requires nothing more than access to credit card numbers, which are available in hacked databases or susceptible every time you hand your card over to a gas station attendant.

Viruses in spam or phishing emails continue to plague consumers and as scammers get more sophisticated, the chances of getting hooked increase.

Banks and business will continue to feel the pressure as criminals target their clients’ data.

Credit card skimming at ATMs and gas pumps makes it impossible to protect yourself when you could essentially be handing your digits over to a criminal.

Skimming is one of the financial industry’s fastest-growing crimes, according to the U.S. Secret Service. The worldwide ATM Industry Association reports over $1 billion in annual global losses from credit card fraud and electronic crime associated with ATMs.

Marite Ferrero, a blogger with Finextra, adds, “In Europe, the points of compromise are everywhere: ATM, gas pumps, parking, DVD rentals, movie tickets, food kiosks, tolls, buying metro tickets, and the list goes on… Because of chip and pin implementation, the proliferation of stand-alone terminals that accept chip and pin has provided a profitable playground for fraudsters.”

While the card holder is generally only responsible for the first $50.00 in losses, which is often waived by a “zero liability policy,” card holders who don’t pay attention to their statements often let these charges pass and eat them.

There are many technologies available to secure credit cards, such as “smart cards” and “chip and pin.” However, due to the nature of a credit card transaction, once the data leaves the card, it’s up for grabs. Whatever card security their may have been is now gone.

Check your credit and banking statements carefully. Scrutinize every charge and refute any unauthorized charges within 30-60 days. Call your bank or credit card company immediately if you see any fraudulent activity.

Invest in identity theft protection. Credit freezes or fraud alerts help prevent new account fraud. Protect your PC with McAfee, or other Internet security software.

Robert Siciliano, identity theft speaker, discusses credit card fraud.

I’m excited to work with uni-ball in 2009 in a partnership to help raise awareness about the growing threat of identity theft and provide tips for protecting yourself. Check out uniball-na.com for more information.