According to federal prosecutors a worldwide gang of criminals stole the total amount of $45 million by using a hacked database of prepaid debit cards and then draining cash machines around the globe. Seven people which are connected to the case are currently under arrest in the United States. The fraudsters used bogus magnetic swipe cards, carrying information from Middle East banks. According to Attorney Loretta Lynch, the fraudsters worked in cells including one in New York.
Hackers got into the bank databases, eliminated the withdrawal limits on prepaid debit cards and created access codes. Others copied that data on plastic cards like an old hotel key card or and expired credits card. A network of operatives then started to rapidly withdraw money in multiple cities with those cards. The cells then cut of the money and laundered it through expensive purchases or ship it wholesale to the ringleaders. According to Lynch, it appears that no individuals have lost money. The thieves robbed funds held by the banks that back up prepaid credit cards, not individual or business accounts.
According to her this was probably the biggest ATM fraud she had ever hear of. In fact there were two separate attacks going on. One in December that reaped $5 million worldwide and one in February that robbed $40 million in 10 hours with around 36,000 transactions. The scheme involved attacks on two banks (Rakbank in the UAE and Bank of Muscat in Oman).
The emptied ATMs were in Japan, Russia, Romania, Egypt, Colombia, Britain, Sri Lanka, Canada and several other countries. According to US prosecutors there was about a dozen nations involved into the investigations. The accused ringleader in the US cell, Alberto Yusi Lajud-Pena was reportedly killed in the Dominican Republic late last month. More investigations continue and there have been more arrests made in other countries. Such ATM fraud schemes are not uncommon according to Avivah Litan, who covers security issues for Gartner Inc. Middle Eastern banks and payment processors are often a bit behind on security and screening technologies that are supposed to prevent that kind of fraud.
One of the faults is the magnetic stripe on the cards. Most countries have abandoned that technology and replaced it with chips that are nearly impossible to copy. Source: Yahoo News AU
