Banks gave ‘knee-jerk’ response to skimming

BANKS have been criticised for their “knee-jerk” response after restricting tourists’ cash withdrawals to €100 per day after a massive card skimming operation was uncovered.

Last Thursday, criminals put skimming devices on debit/credit card machines in five large stores in the north and east of the country, recording the details of thousands of customers.

It is understood the scam was detected the following day when one of the affected stores realised there was something attached to the terminal which they did not recognise.

That device had the capacity to record information from a card’s magnetic strip.

In an effort to stop the criminals using the data collected in countries where chip and pin technology has not been introduced, banks, including Bank of Ireland, placed restrictions on what customers using debit cards abroad could withdraw.

Initially, Bank of Ireland set its limit at €100 a day and then increased the limit to €250. A number of people on holiday were left short of cash as a result of the restriction.

However, Martin Duffy of SAS Ireland, a company which specialises in banking security, said the banks’ action was a “knee jerk” response.

“I can understand that they want to minimise the possible gains for the fraudsters, but customers should not be inconvenienced by something for which they are not responsible,” he said.

Mr Duffy said there was ample technology to allow banks to form a profile of their customers’ spending and so monitor for any blips in their activity which might indicate fraudulent usage.

“If they detect something, the bank can respond in a way that is appropriate,” he said. “If I was in Spain at the start of last week, why should I not be allowed to withdraw money when I am still clearly there?”

The Garda investigation into the fraudsters was continuing last night and fraud officers were studying CCTV footage of the gang caught on the shops’ CCTV systems.

However, it is likely some of the masterminds behind the scam may be located outside the country.

This is the second time in a month gardaí have been called in to investigate fraudulent use of bank cards.

Two weeks ago it emerged hundreds of bank customers had to cancel credit cards after personal banking details were compromised when thieves hacked into the online database of one of the country’s leading retailers.

The scam was discovered after the fraudsters attempted to use the credit card details to test if the cards were valid.

The so-called testing came to light when transactions for up to €1 appeared for items purchased on US website Kosher.com. That allowed fraudsters to determine if cards are still in use before using them for larger purchases.