Slam the Brakes on Gas Pump Fraud and Rental Car Scams This Memorial Day Weekend
Nidhi Alberti: What are the biggest fraud risks consumers must look out for during travel?
Seth Ruden: ATM and fuel pump skimming are the largest risks for travelers. In fact, it’s the most likely place one may experience fraud relative to the card’s payment data being stolen and counterfeited while on a brief holiday.
NA: I’ve certainly heard a lot about ATM skimming, but fuel pump skimming doesn’t come to mind immediately. Tell me more about that.
SR: Gas pumps are right now one of the best places to skim payment cards, as most are still primarily reliant on magnetic stripes (and will be until 2020) and are not ready for (EMV) chip-based transactions. We’ve certainly seen a dramatic increase in gas pump skimming in the last couple of years, and it isn’t expected to slow down until well after the EMV conversion is done. Considering this fact, the NYPD is developing a new tool called the “Skim Reaper” to detect if an ATM or a gas pump has been compromised, according to a recent story.
NA: That’s quite troublesome to hear. So, how are skimmers going about doing this?
SR: Skimmers are usually placed internally and integrated in the pump’s electrical system, accessed via the pump’s key and therefore frequently invisible to the customer.
NA: So, how would a consumer be able to protect themselves if they don’t know what to look for?
SR: I would urge all consumers to always look for anti-tampering stickers on every fuel pump terminal. It’s usually orange, yellow, green, red or another high visibility sticker that goes over the card acceptor panel gap across to the fuel pump’s body and provides evidence that the point of sale terminal has not been opened or manipulated. Most gas stations should have these by now, and if they don’t, they may be targeted for skimming.
NA: What should consumers do if they see a broken sticker?
SR: It’s a strong indicator that the pump may have a card skimmer attached to it! I would inform the gas station attendant about it immediately.
Consumers should also keep in mind that high-traffic gas pumps are desirable skimming sites, such as those close to the freeway. Typically, it’s the pump that is most accessible to the highest quantity of drivers. If you arrive at a pump, and there is no sticker evident, just walk into the store and pay at the cashier instead. That will mitigate the risk of skimming, typically. Gas stations are infrequently skimmed at the convenience store checkout.
NA: Wow. That’s good information for travelers out there. Any other tips you’d like to share?
SR: Yes, even though most consumers are aware of ATM skimming, it bears repetition. Covering your hand when entering your PIN with a free hand while using an ATM is smart behavior to convert into a habit. Of course, always contact your bank before traveling to have an alert placed on your account. In addition, I would bring two or more cards when traveling in case one of them gets blocked by your bank. Lastly, if your card gets jammed in an ATM and won’t be returned without intervention, don’t accept help from a stranger. Just contact your issuer and cancel the card immediately.
Finally, besides gas pump fraud, travelers must also keep a look out for increasing rental car fraud. According to recent industry data, Washington, D.C. is the most popular city for car rentals, followed by San Francisco and L.A. However, for car rental fraud attempts, Toronto, Chicago and Brooklyn are the cities of choice, all averaging a 5% fraud attempt rate by volume when the reservation was created via a mobile application.
NA: That’s interesting. How does rental car fraud happen, and what should consumers know about it?
SR: In most cases, fraudsters are using stolen identities to create driver’s licenses and applying for credit cards in the same name. They’re then not only renting cars, but likely running up charges in other ways, including fueling up the rented cars!
Identity theft is a serious problem and travelers must look for warning signs, such as unknown or strange charges on their bank account, and monitor their credit reports frequently. Consumers must be vigilant at all times when making digital payments of any kind. After all, their money is at stake.
Read more about how financial institutions can help mitigate fraud and ensure that consumers’ financial assets are safe in ‘The Fraud Trap: Optimizing Digital Payment Controls From Day One’ by ACI and Javelin Research & Strategy.
Related Blog Posts
The Co-op U.K.: In with the New Does Not Mean Out with the Old
I had the pleasure on May 19 to discuss The Co-operative Group’s consumer payments strategy with Paul Fletcher, Co-op’s Head of Payments.
The Co-operative Group is a compelling case study within the U.K.’s convenience grocery sector; steeped in history and tradition, with a culture that demonstrates a real heartfelt pride in its mutual ownership origins. A nod to the past now seems to be a trend among big businesses, as they remind customers of their (usually) long-ago establishments and “origin stories.” But in the case of Co-op, it really does mean something, and it influences everything they do — payments included.
Move Over EMV – Meet the Real Protectors of Fuel Pump Payments
There’s much more than EMV for fuel merchants to consider when it comes to blocking fraudsters. Learn why P2PE and tokenization are the data security duo fuel merchants need to block fraud and satisfy genuine customers.
The EMV Deadline Has Been Extended for U.S. Fuel Merchants – Now What?
U.S. fuel stations were originally supposed to be EMV-compliant by October 2017, but due to complications and costs at the time, the deadline for EMV at the pump was extended for three years – and it has now been pushed out further to April 2021 due to the COVID-19 pandemic.
Merchant Fraud in the Age of COVID-19: We Need to Prepare Ourselves for a “Tidal Wave” of Attacks
With millions of consumers around the world self-quarantining at home, online shopping for goods, services and entertainment has become the new normal for many. A recent analysis of our own data has shown that average transaction volumes in the retail sector in March rose 74 percent compared to the same period last year.
Are Chargebacks Making a Comeback for U.S. Fuel Merchants?
With the planned EMV implementation date looming for U.S. fuel merchants, we’ll be spending some time ahead of the October 2020 deadline looking at the fraud issues affecting fuel merchants and how these might change through the final quarter of this year.
Rebirth of The High Street: An Unintended Consequence of COVID-19?
You don’t know what you’ve got until it’s gone. How true that is right now for the U.K.’s High Street (or for that matter local retailers in communities around the world) and our desire to shop.
Merchant Considerations for Protecting Payments During the COVID-19 Crisis
As the spread of COVID-19 continues to impact businesses of all shapes and sizes in unprecedented ways, the power of payments has never been clearer. Drastic increases in online transaction volume and the need for essential in-store payment processing create new challenges for online and brick-and-mortar retailers alike. Here are a few ways that merchants can protect their business – from the perspective of payment processing and fraud mitigation – during this uncertain time.
Positioning PSPs for Success in 2020: Scalability, Flexibility and Globality
We used to say that NFRs (non-functional requirements) such as scalability and availability didn’t really make for attention-grabbing headlines, but in fact, 2019 has shown us that these NFRs are often not far away from the biggest stories. A major outage or downtime – be it for bank or merchant – makes headlines in its own right, but we’re increasingly seeing a clear link between NFRs and a company’s growth trajectory. Those companies that are generating positive awareness from their ambitious global expansion plans, innovative customer experiences, or unique approach to fighting fraud – they are achieving this off the back of technology solutions that deliver world-class non-functional requirements. Scalability, flexibility and globality underpin these growth stories – and this message comes out clearly in speaking with some of our leading payment service providers (PSPs), which are supporting the growth of thousands of merchants around the world.
Three Merchant Payment Trends to Watch in 2020
In 2019, merchants everywhere were challenged by pressure from new entrants, the continued breakdown of traditional industry boundaries and growing customer preference for a digitally-led or digitally-influenced purchasing experience.
Learn How to Claim a Greater Slice of the Mobile Payments Pie
U.S. Wireless Players: $14.3B is at stake – are you in?
Mobile commerce is thriving as consumers seek out convenient, quick and secure shopping experiences. And transaction growth on mobile devices is outpacing traditional desktop and in-store channels, aided by click and collect and one-click purchasing trends. For U.S. telcos, the message is clear: proactively add value to the payments process, or risk missing out on increasing your portion of the growing mobile payments market.