ATM fraud on the rise

A new report shows that fraud at ATMs is at record levels over the first part of the year.

According to credit scoring and analytics firm FICO, ATM fraud from January 1 through April 9, 2015 is at the highest level in 20 years.

When compared to the same period of 2014, debit card fraud is up 174 percent at terminals located on bank property. Theft at machines in other locations fared even worse, rising 317 percent. 

"These tremendous spikes in fraud are unprecedented," John Buzzard, the manager of FICO's card-alert service, told The Wall Street Journal (WSJ).

With the government deadline for EMV implementation fast approaching in October, WSJ reports that incidents have increased as hackers try to avoid the new platform and the added security it brings, which was confirmed by their sources.

"Know there is still vulnerability [at the ATM] and [criminals] are trying to capitalize on it," Owen Wild, director of security marketing at NCR Corp., one of the largest ATM manufacturers, told WSJ.

As part of the governments' EMV deadline, liability for fraud will transfer from the card issuers to merchants, prompting them to upgrade their systems. This deadline does not currently apply to ATM operators, though the WSJ reports that the shift could come by late in 2016 at the earliest. Despite that revelation, both J.P. Morgan Chase and Bank of America are currently working towards switching out their ATMs with more advanced models.

FICO would not release other information about the thefts for the protection of victims. Industry analysts, in speaking to WSJ, said that it is difficult to estimate the about of fraud, but ATM consulting firm Tremont Capital Group estimates that $1.5 million will be stolen from ATM compromised debit cards by the end of the year.

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