Tuesday, June 23, 2009

Skimming Off the Top

Posted By on Tue, Jun 23, 2009 at 11:24 AM

Longtime readers of this blog prolly know that I am fascinated by credit card skimmers. Especially the ones that are installed on ATMs and gas pumps to steal your account information as you swipe your cards.

(I don't know why; I think it might be that as much as I don't want to see a skimmer in real life — especially if I'm about to stick my credit card through it — I would like to be able to recognize one when/if I see one.)

This morning, I chatted with Tami Nealy about skimmers and basic things you can do to protect yourself from identity theft. In town to speak at a state mentoring conference, Nealy is the director of Public Affairs for LifeLock, an identity theft protection company.

"Most people go to the same gas stations and ATMs," Nealy said. "If you're familiar with a certain ATM, and it looks bulkier than usual, or if you go to put your card in and it seems tight, walk away from that machine and tell the people at the bank."

Though an ATM at a bank branch is less likely to have a skimmer installed, Nealy has heard of cases of it happening and the bank has no idea. Thieves also put a camera on the ATM, perhaps in the brochure holder, to catch account-holders entering their PIN numbers.

Nealy also cautioned about hand-held skimmers that can be used by anyone who takes your credit card and walks away with it to run it.

"There is something you can do," she said. "You can ask the waiter or waitress, 'Can I walk with you?' You can say, 'It's not that I don't trust you; I've just had a problem in the past.'"

Consumers can get a free credit report once every 12 months from each of the big three credit report bureaus. However, Nealy suggested spreading out the requests, so that you can view a credit report from a different credit bureau every four months.

(Visit annualcreditreport.com to get one for free. There are other sites out there, and some of them charge for the service.)

"You want to see that you're familiar with everything that's on there," Nealy said. "If you see a Discover card pop up and you don't have one, that's a problem."

She suggested the best line of defense, however, is to file a fraud alert with the credit bureaus. That way, whenever you want to get a new line of credit, you should receive a phone call verifying that you're you.

Doing so is free, but fraud alerts — if you haven't been a victim of identity theft before — expire after 90 days. If you have been a victim of identity theft, you can set a fraud alert for seven years.

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"They can't sell your personal information during that 90 days, and that's their bread and butter," Nealy said.

She also noted that payday lenders typically don't subscribe to the credit report bureaus and so a fraud alert wouldn't help identity-theft victims in that case.

"A fraud alert is a great line of defense, but it's not bullet proof," she said. "At the end of the day, the person most empowered to protect you from identity theft is you."

UPDATE: This is upsetting. New skimming software in Eastern Europe allows thieves to insert to enter a "trigger card" into an ATM. The receipt printer then prints a list of all the debit card numbers used that day, as well as their expiration dates and PIN numbers. Read more at New Scientist.

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