Debit card thieves get around PIN obstacle

[charliekilothree]

Wave of ATM fraud indicates criminals have upped the ante


With consumers around the country reporting mysterious fraudulent account withdrawals, and multiple banks announcing problems with stolen account information, it appears thieves have unleashed a powerful new way to steal money from cash machines.

Criminals have stolen bank account data from a third-party company, several banks have said, and then used the data to steal money from related accounts using counterfeit cards at ATM machines.

The central question surrounding the new wave of crime is this: How did the thieves managed to foil the PIN code system designed to fend off such crimes? Investigators are considering the possibility that criminals have stolen PIN codes from a retailer, MSNBC has learned.

The incident calls into question the security of the four-digit code that for years has made PIN-based transactions less subject to fraud than signature-based credit card transactions.

"This is the absolute worst hack that has happened, the biggest scam to date," said Gartner analyst Avivah Litan.

In recent weeks, Bank of America, Wells Fargo, Washington Mutual and Citibank have all reissued debit cards after detecting fraudulent activity. Smaller banks, such as Ohio-based National City Bank and Pennsylvania-based PNC Bank, have taken similar steps.

Consumers complain around the country
In the meantime, complaints from consumers who say thousands of dollars has gone from their accounts continue to multiply. Police in Erie, Pa., say they've taken reports from dozens of residents. There are more than 100 reports of fraud in Las Cruces, N.M. In Western Massachusetts, after mounting complaints, including 147 compromised accounts at the Fitchburg Municipal Employees Federal Credit Union, the state Consumer Affairs Office issued a warning about debit card fraud.

The tales of theft are consistent and disturbing.

"Last week, I was online paying some bills and noticed several ATM transactions from Toronto, Blainville ...," wrote Dana Lark of Naples, Fla., to MSNBC.com. "By the time I called my bank and reported the problem, they had gotten $1,300 of my money. I told my husband to check his business account, which has an ATM card tied to it, and he found over $1,500 of unauthorized charges from those same places and also Bulgaria."

Financial institutions around the country continue to issue warnings, the most recent this week by Citibank, which said it had spotted fraudulent withdrawals from U.S. accounts made in Canada, the United Kingdom and Russia.



In each case, the banks have blamed a third-party company — in some cases, more specifically identified as a merchant or retailer. Speculation has been rampant that the source of the stolen data is office supply store OfficeMax, starting with an article last month in the San Francisco Chronicle indicating 200,000 account numbers had been stolen from the firm. OfficeMax denies it's to blame.




http://www.msnbc.msn.com/id/11731365/



I check my account at least 5 times a week so I will know if any unauthorized withdrawls have occured. People will go to great lengths to get somebody elses money.

[Chelbe]

It's crazy out there. I check my account 2-3 times a day.

[charliekilothree]

Originally Posted by Chelbe

I check my account 2-3 times a day.

You guarding yo cash huh?

[Chelbe]

Originally Posted by charliekilothree

You guarding yo cash huh?

And you know it! I work too much OT to be playing games.

[MrAtlanta]

There was once an older generation of black people who never trusted the banking system. The individuals of that generation kept their money in or under their mattresses, in cookie jars or tin cans, or somewhere in their closets.

I trust the banking system to a certain extent, but I don't do any of that online-banking stuff. I think you leave yourself open to all sorts of things by placing account numbers, social security numbers or other sensitive data into cyberspace. That's just me.

[charliekilothree]

Originally Posted by MrAtlanta

There was once an older generation of black people who never trusted the banking system. The individuals of that generation kept their money in or under their mattresses, in cookie jars or tin cans, or somewhere in their closets.

I trust the banking system to a certain extent, but I don't do any of that online-banking stuff. I think you leave yourself open to all sorts of things by placing account numbers, social security numbers or other sensitive data into cyberspace. That's just me.

I see your point MrAtl. I know that I'm taking a chance by doing online banking but I have been lucky so far and I hope my credit union has the proper safeguards in place to reduce the chances of fraudulent activities in their system.

[MzPhynixRyzn]

I have been a victim of unauthorized transactions against my account. Luckily, I check my balance often and was able to file an EFT investigation. The transaction was reversed and my account credited. This transaction was with Sprint. One of their employees tried to be slick, and eventually got caught. Because of this, Sprint has changed the way they accept payments. I still use caution and continue to check my account regularly.

[MadameX]

Originally Posted by charliekilothree

I'm taking a chance by doing online banking but I have been lucky so far and I hope my credit union has the proper safeguards in place to reduce the chances of fraudulent activities in their system.

Charlie, its unfortunate that nothing is safe no more and your business is public domain. That's why I have discontinued most of transactions online because you're privacy can be compromised.

[Chelbe]

Online banking is risky. I guess the question is if the convenience is worth the risk. Even the simple task of writing a check is risky to me because sometime all thats needed is your routing number and account number to make a purchase. I've began to purchase money orders to pay a few bills here and there.

[MadameX]

Originally Posted by Chelbe

Online banking is risky. I guess the question is if the convenience is worth the risk.

This is so true. As I said before, nothing is safe no more and your business becomes public domain.