March 3, 2023
Written by Haley Rogers
Financial Writer
Financial Writer
Haley Rogers is a content marketer and personal finance writer covering topics like inflation, savings, retirement, spending, budgeting, finance scams, and more. Her work spans various industries, with personal finance content primarily published on MagnifyMoney and ValuePenguin.
Credit card skimming is a method of stealing card info at point-of-sale locations. Skimmers are a little harder to spot today, but we're here to help.
It's not just your imagination – the use of credit card skimmers is on the rise, according to FICO data.1 Scammers place these fraudulent devices over or inside legitimate card readers to steal banking information.
Today, they're making these skimmers harder to detect, but we say, not so fast. We'll explain what card skimming is, how to spot it, and how to protect yourself from today's sneakier skimmers.
Card skimming is a type of data breach in which a criminal places a card skimmer – a fraudulent card reading device – over or inside actual card readers at various point-of-sale locations.
Scammers hope to collect your banking information from the magnetic stripe on your card or a hidden camera to make fraudulent transactions or even counterfeit cards.
Some of the most common target locations for card skimmers are:
ATMs
Gas pumps
Parking meters
Ticket kiosks
Restaurants
Other point-of-sale terminals
The FBI estimates that card skimming costs financial institutions and consumers more than $1 billion every year.2
There is no one-size-fits-all when it comes to credit card skimmers. Many card skimmers can look almost identical to the original card reader, while others may be larger and be colored differently than the card reader, making them easier to spot.
Some card skimmers fit over the existing card reader, and others may be attached to the internal wiring of the card reader. Other skimmers – called "shimmers" – are tiny chips that fit inside the card reader to read a chip-enabled debit or credit card. As of now, these are much less common.2
The Federal Trade Commission (FTC) has some example images of card skimmers at a gas pump.
Check other card readers nearby: Is the card reader different in any way? Does it have random flashing lights, a lifted keypad, or certain colors, while the rest do not? If it doesn't match up with others nearby, steer clear.
Look at the security label or seal: Most gas pumps have a piece of security tape or a label over the card reader. If that tape is broken or reads "void," it's likely that the card reader has been tampered with.
Wiggle the card reader: If the card reader moves, feels loose, or seems off alignment, it's probably not the original device.
Don't force your card into a reader: If your card doesn't go into a chip slot very smoothly, this could signify a "shim" inside – a tiny skimmer that works on chip-enabled cards.
Look for hidden cameras: See any holes in the kiosk pointing at the keypad? Although a camera may stand out more at a gas pump, it's harder to detect hidden cameras at ATMs (since they already have built-in security cameras).
Run debit as credit: This is a way to avoid entering and exposing your PIN.
Don't use your debit card: Your credit card may have more protection than your debit card, and you don't need to enter a PIN.
Cover the keypad: Cover your hand while typing to avoid hidden cameras tracking your PIN.
Pay the merchant inside: Paying directly helps you bypass most concerns of a card skimmer.
Pay another way: Pay with cash, a chip-enabled card, or an online payment option, like Apple Pay.
Set up alerts: Set up security alerts to stay on top of real-time activity.
Check your statements: These records help you catch fraudulent activities early.
Avoid isolated ATMs: ATMs not near other businesses or high-traffic areas are easier targets for ATM skimmers.
Avoid dark, isolated fuel pumps: Stay at a well-lit gas pump in view of the store merchant.
If your credit or debit card is skimmed, the criminal may try to use your banking information to:
Make fake credit or debit cards
Pull money directly from your account
Make fraudulent purchases online or via phone
Sell your data on the internet
Apply for loans
According to FICO, skimming incidents typically show up within two weeks after the card was used.1 In a world full of money scams, it's wise to check your bank statements and account activity regularly. Security alerts and credit monitoring can help you stop scammers in their tracks.
Quick tip: Credit cards are usually a safer option when presented with a card reader, as most card issuers offer zero liability protection – meaning, cardholders are typically free of financial responsibility regarding fraud.
The sooner you report any incidents, the better off you'll be. If your information has been skimmed, take these steps:
Do this first, so you can cancel the card and cut off access. Depending on your card issuer or bank, you may be able to report fraud via the app or website – but to speed things up, call the number on the back of your card. They'll be able to cancel it quickly and send you a new one.
At Chime, you can contact customer service and speak to a human 24/7 via in-app messaging, phone call, or email.
Set up free fraud alerts with each of the three main credit bureaus – Experian, TransUnion, and Equifax. With these in place, criminals who have obtained your information shouldn't be able to open new accounts or take out loans in your name. Just cancel the alert when you're ready.
File a report on the FTC's IdentityTheft.gov website if you know you've been the victim of credit card skimming fraud. This database is a resource used by law enforcement when doing deeper fraud investigations.
Provide the merchant with as much detail on the skimmer location and what it looked like (if you remember) – this helps protect their business and other consumers. Consider checking your state for a submission form in which you can report the card skimmer fraud. For example, Texas has a skimmer form for residents.
Set up account activity alerts and check your statements, so you stay aware of any fraudulent activity.
Criminals place credit card skimmers over legitimate card readers at various point-of-sale locations to steal banking information. The fraudster then uses that data to create fake credit and debit cards or steal from people's accounts.
Some skimmers do work on chip cards, though this is less common. In this case, criminals use a tiny version of a skimmer – a "shim" – and insert it into a chip reader. The fraudster can collect data from the chip on your card, just as they do from the magnetic strip.
Yes, card skimmers can collect your security code (CVV), name, card number, and expiration date from the magnetic stripe on credit, debit, and ATM cards.
Most people find out their card has been skimmed by checking credit card statements and account activity. If unauthorized transactions appear on your account, your card could have been skimmed recently.
Skimmers can be sneaky, but being cautious can help you avoid them. Pay attention to the details on card readers before you swipe, and keep an eye on your accounts.
At Chime, we care about our members' security. Learn more about protecting yourself from these common scams.
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