High-tech credit card swindlers target NZ

By SCOTT MacLEOD

A high-tech credit card fraud that has fleeced Australians of $50 million in a year is about to hit New Zealand, credit card companies say.

Fraudsters in Australia use machines able to read the details from magnetic strips on credit cards and copy them to blank cards, which are then used for purchases.

A Visa card expert will brief police and bank officials in Auckland today.

Police say they are training to tackle the scam, which has already been used in Lower Hutt.

The scam, called "skimming", has swept through Australia, where fraudsters working in service stations and restaurants have copied thousands of cards.

It has become the most common type of credit card fraud in Australia.

Visa believes New Zealand will be next, and is warning people to be careful with their cards.

Some criminals use secret cameras to record card users' PIN numbers as the numbers are tapped into Eftpos or automatic teller machines.

In December, fraudsters placed a card recorder on the door of an ATM cubicle at an ASB branch in Lower Hutt.

The bank had to reimburse a customer whose account was raided after the customer used a card to gain access and its details were left on the recorder.

Skimming reaped $50 million last year in Australia.

The total for all credit card fraud in New Zealand last year was $12 million.

Visa's New Zealand and Australia risk manager, Ian McKindley, said he expected skimming would cross the Tasman.

It hit Australia 18 months ago, and credit card fraud in New Zealand tended to be 18 months behind.

"We should not wait for this problem to arrive on these shores," he said.

"It's prolific. We're already getting a lot of New Zealand folk coming to Australia and getting skimmed at service stations."

Last year, fraudsters leased a petrol station in Melbourne and spent six months skimming thousands of cards.

Huge bills were racked up as far away as Canada.

A quarter of Malaysia's restaurants were last year stripped of their rights to accept credit cards because they had skimmers on their staff.

The national manager of the police's electronic crime unit, Maarten Kleintjes, said his staff were "skilling up on the technical know-how" of dealing with skimming.

Mr McKindley said it was not illegal to own a skimmer in Australia or New Zealand. One way to fight the scam was by using new cards with computer chips inside them.

The ANZ bank introduced chip-enabled cards 18 months ago and it said yesterday that they protected against skimming and on-line fraud.

Last week the Australian Government said a crime commission would collect details on skimming in a big crackdown.

Senior police said they were unaware of any similar plans in New Zealand.

The good news for cardholders is that banks usually reimburse people who have been skimmed.

Keeping cards safe

* Keep your credit card in sight at all times

* If a sales assistant swipes your card through two devices, tell your bank.

* In restaurants, pay at the cashier rather than placing your card on a waiter's tray.

* Foil secret cameras by covering your hand when typing your PIN number.

* Check your bank statements.