Skimming of Credit Cards

What is skimming. Skimming is a fraudulent activity involving the illegal copying, or "skimming", of the account information, stored in the magnetic stripe of a credit or debit card. It usually happens after the card has been presented to be used in a legitimate transaction. The skimmed information is subsequently used to make copies of the payment card to be used in fraudulent transactions or the information itself may be sold to criminals.

How the skimming of payment cards is done. Unfortunately it is way too easy to skim the information off of a credit or check card. The information theft is usually committed in a card-present setting, for example in a restaurant, a bar or in other similar establishments where the swiping of the payment card takes place out of sight of the cardholder. Once the customer submits his or her card and it is taken to the processing terminal, it is run through a small mobile device which copies the information contained in the magnetic stripe. Then the card is also run through the terminal's slot to complete the legitimate transaction and it is eventually returned to the unsuspecting cardholder.

How to prevent skimming. Skimming is illegal and it is every merchant's responsibility to ensure that it is not taking place in his or her establishment. You and your personnel should be on guard against:

• The use of all electronic devices that are not needed or normally used in your type of business. If you are not sure exactly what a particular device is used for, you should investigate.
• Any offers to record payment card account information for whatever reason.

If you believe or suspect that skimming might be taking place in your establishment, you should immediately contact your merchant account provider and take the appropriate measures against the employee(s) involved.