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ATM Group Proclaims ATMs Secure

Jul 23 2008 : The ATM Industry Association (ATMIA) has responded to recent press coverage about ATM crime (with a statement reaffirming the industry’s faith in ATM security.

The ATMIA is a global non-profit trade association with 1,050 members in 50 countries. It owns the Global ATM Security Alliance, which provides security resources to protect the ATM industry from criminal activity

“The ATM in general, and the PIN in particular, are extremely secure and safe for consumer use,” says Lana Harmelink, the ATMIA’s International Director. “There are 1.6 million ATMs in the world performing millions of transactions every day, and the scale of ATM crime is minute, compared to these volumes of safe, convenient transactions going through our systems all the time.”

“Most of what is reported by the press as ATM fraud is actually PIN fraud or debit card fraud,” Harmelink says. “This fraud occurs when criminals obtain counterfeit cards and PINs from skimming either POS terminals or databases operated in the retail environment.”

According to the ATMIA, there are about 49 billion cash withdrawals each year at ATMs, including 14 billion at U.S.-based ATMs. The amount of cash withdrawn annually from ATMs in the U.S. is several hundred billion dollars. The ATM industry’s estimated fraud losses are less than one-tenth of 1 percent of cash dispensed at ATMs in the U.S., and these losses are carried by the issuing banks and networks and not by the consumer.

“A combination of banking laws and network rules ensure that consumers in many countries, including the U.S., are protected from losses arising from fraudulent use of their ATM card, PIN, or personal financial information,” the ATMIA says. /p> Harmelink says the ATM industry has taken steps to safeguard customers’ privacy at ATMs, including the implementation of Encrypted PIN Pads (EPP) and Triple DES Encryption (Triple DES). “These security enhancements, which instantaneously encrypt PINs within the PIN Pad, are now mandatory on all ATMs operating in the U.S., and have effectively eliminated the electronic theft of PINs from the ATM,” she says.

“Today, criminals attempting to steal card data and PINs at ATMs are likely to do so by using physical skimming devices coupled with PIN Pad overlay devices or camera systems,” Harmelink says. “However, this is a relatively rare type of fraud, which is particularly difficult to accomplish with ATMs placed in retail locations.”

Retail ATMs are under constant scrutiny by store staff during business hours and are unavailable to would-be criminals during non-business hours, Harmelink says. This makes it particularly difficult to install and retrieve the equipment required to steal card data and PINs.

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