Banking on trust

A rash of card fraud incidents between Monday and Wednesday made it clear that card skimming remains a significant concern for citizens.

In just three days, police have reported so far that they believe $300,000 was taken using duplicated cards from the bank accounts of 60 people.

It’s a crime that requires significant co-ordination, because most ATMs limit the amount of cash that can be taken in a single day from a particular location. So cards must be moved around the country quickly and used before bank authorities can recognise patterns of abuse.

The new chip cards are supposed to be less vulnerable to duplication, but a technique called “shimming” that defeats them has been on the rise since 2017.

The Bankers Association issued a release after the police report warning card holders to be careful about how they use them.

It’s all well and good to issue statements urging customers to be vigilant about their card use.

But it isn’t clear that the banking community as a whole has done enough to improve its policing of the vulnerabilities of the card system.

As the conversation about a “cashless society” gains traction, improved security for electronic transactions needs to be a significant part of the discourse if the public is to make that transition. Customers need to be able to trust their financial institutions at this most basic level.

But bankers have not stepped up with any visible increase in the surveillance and inspection of suspect terminals and ATMs, which tend to be the first point of compromise.

Customers should expect that some of the healthy amounts of revenue that bankers cheerfully report at the end of their financial year should be turned to developing security systems that protect credit and debit cards from fraud.

The stolen money is normally returned to affected accounts, but only after customers have gone through a particularly tedious reporting system that often requires multiple visits to the police to report fraud and filing statements with the bank.

No part of that is any joy for the customer – who is not at fault but who must go through hoops to verify the circumstances of the theft – the police – who will often shrug and admit that there is very little they can do about the robbery – or the bank, which must dig into its profits to refund the stolen money.

Surely, some investment in preventive measures would be a better plan than having to cough up more than a quarter of a million dollars lost in a modern-day bank robbery.

Some banks have been moving their ATMs from street or drive-through access into the bank building proper, where surveillance can, presumably, be improved.

It isn’t enough to try to educate the consumer. More institutional action must be taken to make card fraud more difficult for thieves.