Dive Brief:

• The Secret Service’s investigative arm, which monitors for credit card fraud, locked arms with other law enforcement agencies last year to eliminate 411 illegal point-of-sale card skimming devices at merchants across the country, according to a press release this month.
• The federal agency, which is part of the Department of Homeland Security, engaged in 22 operations and visited 9,000 businesses to attack such fraud by investigating card readers and ATM devices, potentially avoiding $428.1 million in losses, according to the Jan. 7 release.
• The agency’s oversight included examining about 60,000 point-of-sale terminals, gas pump card readers and ATMs last year in Los Angeles, Washington, Anchorage, Boston, Orlando, New York and other U.S. cities.

Dive Insight:

The federal agents shocked and relieved many business owners and managers when they discovered skimmers had been surreptitiously installed by criminals on POS devices at stores and gas stations, said a follow-up press release describing reactions from merchants.

“We had a bakery owner who was visibly upset due to the fact that we found a skimming device in his store — he was literally starting to cry,” one Secret Service analyst said in a follow-up Jan. 9 release, speaking about a Boston investigation. “It wasn’t so much that the device was in there, it was also that it was victimizing his customers.”

The illegal skimming devices allow criminals to capture card information and record it on another card and then use the information for illicit purchases. Despite the federal agency thwarting some of the wrong-doing, it estimates $1 billion in losses still happen annually due to the skimmers.

Electronic benefit transfer cards, which provide access to government benefits, have increasingly been targeted by fraudsters, the government said. They pointed to the criminals timing their illegal activity to those days when EBT recipients get monthly public assistance deposits on their cards, which typically would be used to purchase food and other necessities. That fraud has been happening since at least 2021, according to the FBI.

To defend against such crimes, the agency encouraged card users to be on the look-out for damaged, crooked or loose ATMs or card readers, and to be extra vigilant when using card readers in tourist areas. They also suggested using tap–to-pay technology whenever it’s available to skirt skimmers.