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A recent trend in ID theft has been identified in at least six states. The new scam involves the crook replacing a store's keypad with one that will record credit card numbers and PIN numbers for debit cards. The keypad is then removed by the crook and all of the numbers that have been recorded are used for fraudulent purchases, leaving the victims in debt. So far, instances of this type have been reported in Nevada, California, Florida, Massachusetts, Pennsylvania, and Rhode Island.

Very little is known about this type of scam at this time. Typically, the crooks will replace POS keypads in grocery or convenience stores. The breach of security is not outwardly visible, but sometimes an extra circuit board has been placed behind the keypad. The stores have not been able to detect the intrusion since transactions have not been affected and signs of tampering are not outwardly visible. The crooks return and remove the device, sometimes using a diversion so the removal is not detected. The recorded data is then used to create credit or debit cards to make fraudulent purchases and cash withdrawals.

Although this type of scam is typically not detected until the breach has occurred and victims come forward, there are steps that merchants can take to prevent the thieves from targeting their stores. First, merchants need to be aware of this type of scam and educate their employees. Second, identify the things that make you vulnerable to this type of scam. Third, after identifying the vulnerabilities, take steps to prevent this type of scam from happening at your place of business. Just one possible example could be installing security cameras and reviewing the tapes daily may help identify someone defiling the POS device. Regularly checking your POS devices for damage or signs of tampering may alert you to a possible breach quicker. Making sure that adequate employee coverage may deter the crooks from targeting the business.

BankCard Central is familiar with types of fraud and strives to keep abreast of the latest information available. For more information, contact BankCard Central.

http://www.washingtonpost.com/wp-dyn/content/article/2007/05/18/AR2007051800060_pf.html
 
Attention, Shoppers: Checkout Stand 4 Is Now Open to ID Theft
By Tom Spring of PC World
Published on Friday, May 18, 2007