Security Featured Article

Keeping ATM thefts at check has now become a lot easier and effective. ValidSoft, the wholly-owned subsidiary of Elephant Talk Communications and a market leader in providing solutions to counter electronic fraud relating to card, the internet, and telephone channels, has come up with a new technology that allows banks to spot a thief’s attempt to use your ATM card information to withdraw money – and do it in a split second while the transaction is being processed.

Robert Vamosi, a fraud expert at Javelin Strategy & Research, warns that consumers aren’t aware of ATM tampering. ATM skimming, which involves stealing your ATM account number and PIN number, accounts for a reported loss of over $1 billion per year. This type of fraud been around for at least a decade, but now it’s on the rise based on thieves having more sophisticated technologies.

“Our technology can help put ATM skimmers out of business,” says ValidSoft CEO Patrick Carroll. “It enables banks to identify legitimate transactions, so that your own withdrawals aren’t blocked by mistake.”

To carry out the ATM thefts, thieves use two devices; one is a small magnetic card reader placed unobtrusively near the ATM. As you insert your card into the real ATM slot, the device picks up the information embedded in your card’s magnetic strip. The device then transmits it to the criminal who may be sitting nearby. The second device is a small camera carefully placed by the thief so that it focuses on the ATM’s keyboard. When you put in your PIN number, the digits are captured by the camera.

Another approach used by ATM skimmers is to put an official-looking screen and card reader over ATM’s real one. Customers trying to withdraw money get their information stolen by the device. The thief then burns the stolen information on a blank card and starts withdrawing your money.

According to Carroll, a more effective solution is ValidSoft’s system called VALid-POS®: “Our software taps into information about the location of your cell phone. It anonymously compares the proximity of your phone to the location of the attempted withdrawal. If your cell phone is miles away from the ATM machine, then thieves are probably at work with your card information. Banks and card companies that have the VALid-POS software can thus thwart the attempted theft.”

ValidSoft’s solutions are used to verify the authenticity of both consumers and institutions (Mutual Authentication), and the integrity of transactions (Transaction Verification) for the mass market.

Elephant Talk Communications, an international provider of business software and services to the telecommunications and financial services industry, is all set to become a pro in virtual mobile network operations – to enable secure access to sensitive information like bank accounts, doctors to monitor their patients over mobile networks, or allow people to control their home energy use from their mobile handsets.