What is Skimming?

Skimming is a financial crime in which fraudsters acquire sensitive payment information, such as credit card numbers, using malicious skimmer tools.

Unlike more advanced digital attacks, skimming is based on physical manipulation. It frequently targets point-of-sale (POS) terminals, ATMs, and even gas station pumps.

Skimming is the act of capturing data on a credit or debit card’s magnetic stripe without the cardholder’s awareness or consent.

How Skimming Works

Skimmers are usually small, discrete devices linked to authorised card readers. When a customer swipes their card through an attacker-controlled reader, the skimmer records and steals the cardholder’s name, account number, and expiration date.

In other instances, fraudsters install covert cameras to capture PINs and increase their capacity to steal essential information. Skimming can occur at various sites where card transactions happen, including restaurants, retail businesses, and ATMs.

Victims are commonly unaware of the theft until fake and unknown charges appear on their accounts.

Types of Skimming Attacks

1. ATM Skimming: Fraudsters inject malicious tools into ATMs, which can record card data as users insert their cards. These skimmers are frequently combined with a tiny camera or keypad overlay to obtain the victim’s PIN.
2. Point-of-sale Skimming: this type tampers with retail or restaurant payment terminals.
3. Gas Pump Skimming: Because of the accessibility of pumps, gas stations are popular targets. Skimmers are frequently installed inside these gas pump machines, making them difficult to detect.

Impact of Skimming Attacks

Skimming can have severe financial consequences for both individuals and corporations. For consumers, stolen data can be used to make illicit purchases or sold on the dark web, resulting in financial loss and perhaps identity theft. For organisations, skimming undermines customer trust, harms brand reputation, and can result in costly chargebacks.

Preventing Skimming Attacks

To prevent skimming, both consumers and businesses must take proactive actions.

Consumers should regularly check their bank records for illegal charges, use ATMs in trustworthy locations, and avoid card readers that look suspicious. They should also choose contactless payment systems or chip-enabled cards, which provide more security than magnetic stripe technology.

Businesses should regularly scan card readers for signs of tampering, particularly in locations with high demand and user traffic, such as petrol stations and restaurants. Employees should be trained to spot suspicious tools or behaviours to prevent device compromise.

Like other types of social engineering, skimming attacks rely on human error and system vulnerabilities. Consumers and organisations may protect themselves against these attacks by remaining vigilant and using secure payment solutions.

How can iZOOlogic Help My Company or Organisation?

Find out how iZOOlogic can protect against Skimming attacks through our Threat Advisory Services.

To learn more about how iZOOlogic can help safeguard your company’s hardware security, schedule a demo.