March 11th, 2013 (InsideCostaRica.com) While not a new problem in Costa Rica, credit and debit card fraud through the use of electronic devices called ‘skimmers’ is becoming ever more common as the skimming devices become ever easier to obtain.
The devices do their work after a criminal inserts the thin plastic device into an ATM machine’s card reader. The device than reads and stores every ATM users’ card information the moment they insert the card into the machine. The criminal returns later in the day and retrieves the device, which may by then have the full data of hundreds of cards stored on it. That information is later used to create clones of the users’ cards, or for online purchases.
Most of the devices allow the ATM machine to function like normal, and as a result many users have no idea that their card information has just been stolen.
Francisco Segura of the Judicial Investigation Organization (OIJ) said that many cardholders have no idea that they have become victims, and that many times it is instead the banks that alert judicial authorities to possible fraud.
The dismantling of a band of criminals using these devices, led by Cuban citizen and four Costa Ricans, made it clear that these crimes are becoming more common. The OIJ conducted 13 raids a few weeks ago, collecting evidence such as payment receipts, skimming devices, and computers.
The skimmers are also sometimes placed in the credit card terminals at retail establishments, restaurants, and other places that accept credit cards.
But if the key tool in these crimes are the skimming devices themselves, why can’t their sale be regulated?
Roberto Mendez, Director of Security for Banco Nacional, said that regulating the sale of such electronic devices is difficult as they are sometimes used in legitimate commerce. “This technology is here to stay,” he said.
Mendez said that even moving to a different system – such as the “chip” based cards which are widely used in Europe now, would only mean that eventually criminals would switch to chip-based skimmers instead of the skimmers currently used to read the magnetic band on standard cards.
That said, Costa Rica does plan on migrating to the chip-based cards in a matter of 20 months. More than 5.6 million cards in the country must change to the “EMV” (Europay-Mastercard-Visa) system.
Meanwhile, the skimming devices currently used by criminals remain easily found for sale on certain web sites in Costa Rica, sometimes carrying a price tag of nearly 1 million colones ($2,000).
To avoid becoming the victim of these fraudsters, it is suggested to check closely the area on ATM machines where you insert your card for anything that may look like a hidden our out of place device, and also to not allow retail clerks, gas station attendants, and others to take your card out of sight.