If you haven't already heard of skimming, I hope you don't find out about it the hard way. In a nutshell, skimming is a scam where the thieves "skim" a copy of your credit or debit card information when you think you're paying for something legitimate.
For example, skimming is a growing problem at restaurants, where dishonest waiters will secretly make their own personal copy of your credit card when you go to pay your bill - some of the skimming devices are no bigger than a cell phone and so can easily be used without attracting attention.
In some of the more advanced scams, thieves or insiders will go as far as replacing the card readers at store checkouts with their own card readers, and then quietly skim the credit and debit card information from potentially thousands of customers, for months at a time, right under their noses.
And skimming ATMs has proven extremely popular. According to a recent article by Bankrate.com, losses from skimming are approaching $1 billion annually, and Javelin Strategy & Research estimates that nearly one in five fraud victims in 2009 reported having their credit card or ATM card PIN stolen.
One of the most popular targets for skimmers is the gas station – lots of customers coming through at all hours of the day and night, and often too busy to pay attention to tiny little tell-tale signs that the reader they use to swipe their card and pay for the fill-up might not look quite right.
In the San Francisco bay area, roaming gangs of skimmers ripped off dozens of gas stations and thousands of customers, netting more than $500,000. And law enforcement in Florida recently warned of similar gangs that have turned to simple technologies to make the job a little easier.
Skimming at a gas station usually involves a fake card reader placed over the real card reader so that it can intercept the payment and steal your information. The biggest risk for the thieves is usually showing up on their regular skim route to pick up the stolen data, but even that risk has evaporated. The new generation of skimming devices now use Bluetooth technology - the same one that's in your cell phone headphone - to broadcast the data to a thief sitting in a nearby vehicle.
Gives a whole new meaning to "drive-by."
- Always be vigilant when paying for gas or withdrawing from an ATM, and pay particular attention to any devices on, near, or above the card reader that just don't look right.
- Avoid using a debit card to pay for gas. If thieves steal your information they could quickly leave you with an empty bank account to go along with your empty gas tank.