2014-01-23

Co.Labs

How Bluetooth Credit Card Skimmers Became The New Crowbars

Here's how they work and where they come from.



Credit card fraud is getting a major software upgrade. How can a gang of 13 men steal more than $2 million from several gas pumps so easily? Using Bluetooth-enabled credit card skimmers that anyone can buy over the Internet.

Credit card skimmers are nothing new, but recent innovations in 3-D-printed card skimmers and skimmers that directly attach to a POS terminal have made it easier for thieves to get access to your credit cards at all sorts of places you shop.

This un-ironic and not-so-hard-hitting ABC exposé maps out how a credit card skimmer works and how to insert the hardware into ATMs or gas pumps: buy the skimmer, snag a universal key (like the ones used on vending machines) to open the gas pump, snap the skimmer into place, and voilà—you are ready to steal credit or debit card numbers.

This site devoted to Credit Card Skimming Devices, written by a European and Chinese team, is probably your best resource for more info on skimmers. In a post titled "Skimmer Package," the authors explain that the software in the Skimmer-Koro 16 enables a double-direction magnetic strip reading, so whichever direction you swipe, your card will be read. Through infrared rays and a Blu-ray Magnet, the Koro 16 reads the electromagnetic strip on your card and feeds the information to the skimmer receiver to which its attached.

The Koro 16 sends out a Bluetooth signal that can be received and processed with a BaseEXP-16 and will send a coded text message with the PIN code (the authors of the site urge you to buy their software to help with the encoding). The two devices will cost you between $2100-$3900, which is quite a small investment considering that credit card skimming is a multi-billion-dollar-a-year industry.

The 13 men charged by Manhattan District Attorney Cyrus R. Vance, Jr. on Tuesday are facing a 426-count indictment that names four lead defendants. The charges run the gamut from several counts of money laundering to grand larceny. Investigators claimed that the gang of hackers placed card skimmers at Raceway and Racetrac gas stations in Texas, South Carolina, and Georgia, hauling in a total of $2.1 million.

The robbers were smart enough to keep every transaction under $10,000 to "avoid any cash transaction reporting requirements imposed by law and to disguise the nature, ownership, and control of the defendants’ criminal proceeds," according to the statement from the Manhattan District Attorney's office.

As of December of last year, the Bureau of Justice Statistics reported that identity theft had cost Americans $24.7 billion for the year of 2012. That means roughly 16.6 million people have been affected by identity theft crimes.






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