For Fraudsters, Atm Is Indeed All Time Money!

[Honest 836]

For fraudsters, ATM is indeed all time money!

7 Jun, 2008, 2020 hrs IST, TNN

MUMBAI: Internet banking and credit cards are not the only targets on a fraudster’s radar. ATMs are also fast emerging as soft targets with fraudsters constantly evolving their techniques.

Recently, an ATM of a public sector bank in Nagpur was hacked by a member of the maintenance staff. In a comparatively crude attack, the maintenance employee tapped the wires connecting the machine to the server using a small transistor-like device. The device basically intercepts the signal and stores it, making it possible to replicate it later.

So, when an unsuspecting customer walked in to the ATM centre, the digital signals passing from the machine to the bank’s server were tapped. These signals were then re-sent from the back of the ATM machine with the fraudster’s accomplice standing in front of the ATM slot for withdrawing money without actually carrying the ATM card with him. Since the server received the same signal from the ATM as that of the cardholder wanting to withdraw cash, it dispensed the same amount once more.

According to security firm Indiaforensic Consultancy Services chairman Mayur Joshi, “This was a very crude attempt at stealing money, and could have easily been averted if the bank in question took all the necessary precautions.” Banks, on their part, are not forthcoming with details on the frauds that they are hit with, but according to people in the know, instances of ATM frauds are steadily on the rise.

“Frauds are prevalent in smaller banks in smaller cities also. The fact that some banks do not invest properly in their technology and security deployments is catching up with them,” adds Mr Joshi.

In fact, a lot of co-operative banks are in the process of rolling out in-house technology products. “The world-wide trend in IT deployments by financial institutions is that the smaller ones do not invest as much as their richer counterparts. This will obviously leave them more vulnerable,” explains Foundation of Information Security and Technology (FIST) president Vijay Mukhi.

It is not just the smaller banks that are hit by ATM frauds. However, banks such as ICICI Bank, HDFC Bank and State Bank of India invest considerably on their security aspects. HDFC Bank, for example, has outsourced the service and maintenance of over 2,000 ATMs to the world’s largest ATM-vendor, NCR Corporation. “Some banks in India are aware of the various types of global fraud and are undertaking proactive measures to protect the ATM and their customers from fraud,” says NCR Corporation India MD Pradeep Sen.

Apart from a bank branch, the one place which holds a ready supply of cash is an ATM, and unlike the branches, these machines are manned by one or two security guards at best. According to Mr Mukhi, the sophisticated fraudsters are often international groups which move from country to country.

Also, all ATMs run on the Widows platform. “Hacking into any of these is as easy as hacking into a computer, and everyone knows the levels of sophistication fraudsters have reached,” he added. Even as banks are adopting high-end anti-skimming and surveillance products, the easiest way to perpetrate an ATM fraud is through an insider. Security agencies are advising banks to carry out proper background checks on their employees.