WASHINGTON—The U.S. Secret Service is warning financial institutions about a recent uptick in a form of ATM skimming that involves cutting cupcake-sized holes in a cash machine and then using a combination of magnets and medical devices to siphon customer/member account data directly from the card reader inside the ATM, KrebsOnSecurity reported.
The new form of ATM hacking is complex and often takes thieves days to implement, reported Krebs, referring to the non-public Secret Service alert that was distributed to banks and shared with Krebs.
This type of attack, sometimes called ATM “wiretapping” or “eavesdropping,” starts when thieves use a drill to make a relatively large hole in the front of a cash machine. The hole is then concealed by a metal faceplate, or perhaps a decal featuring the bank’s logo or boilerplate instructions on how to use the ATM, Krebs explained.
Using an Endoscope
Skimmer thieves will fish the card skimming device through the hole and attach it to the internal card reader via a magnet. Very often the fraudsters will be assisted in the skimmer installation by an endoscope, a slender, flexible instrument traditionally used in medicine to give physicians a look inside the human body, according to the report.
By connecting a USB-based endoscope to his smartphone, the intruder can then peek inside the ATM and ensure that his skimmer is correctly attached to the card reader, Krebs explained.
The Secret Service says once the skimmer is in place and the hole patched by a metal plate or plastic decal, the skimmer thieves often will wait a day or so to attach the pinhole camera. “The delay is believed to take place to ensure that vibrations from the drilling didn’t trigger an alarm from anti-skimming technology,” the alert reads.
A False Fascia
“When the suspect is satisfied that his drilling and mucking around inside the cash machine hasn’t set off any internal alarms, he returns to finish the job by retrofitting the ATM with a hidden camera. Often this is a false fascia directly in front of or above the PIN pad, recording each victim entering his or her PIN in a time-stamped video,” Krebs said.
In other cases, the thieves may replace the PIN pad security shield on the ATM with a replica that includes a hidden pinhole camera, tucking the camera components behind the cut hole and fishing the camera wiring and battery through the hole drilled in the front of the machine, Krebs said.