Seven people were arrested in the US, accused of operating the New York cell of what prosecutors said was a network that carried out thefts at ATMs in 27 countries from Canada to Russia. Law enforcement agencies from more than a dozen nations were involved in the probe.
“Unfortunately these types of cybercrimes involving ATMs, where you’ve got a flash mob going out across the globe, are becoming more and more common,” said Rose Romero, a former federal prosecutor and regional director for the US Securities and Exchange Commission.
Brooklyn attorney Loretta Lynch, who called the theft “a massive 21st-century bank heist”, announced the case in New York.
Hackers got into bank databases, eliminated withdrawal limits on pre-paid debit cards, and created access codes. Others loaded that data onto any plastic card with a magnetic stripe — an old hotel key card or an expired credit card worked fine as long as it carried the account data and correct access codes.
A network of operatives then fanned out to rapidly withdraw money in multiple cities, authorities said. The cells would take a cut of the money, then launder it through expensive purchases or ship it wholesale to the global ringleaders. Lynch didn’t say where they were located.
It appears no individuals lost money. The thieves plundered funds held by the banks that back up pre-paid credit cards, not individual or business accounts, Lynch said.
Ori Eisen, founder of 41st Parameter, a fraud detection and prevention firm, said the $45m heist was on the “high-end” of what can be done by cyber-criminals who exploit banking systems connected to the internet.
“Given the scale of the global credit card networks, it is almost impossible to detect every kind of attack,” he said.
“This attack is not the last one, and if the modus operandi proves to be successful, crooks will exploit it time and again.”
There were two separate attacks in this case, one in December that reaped $5m worldwide and one in February that snared about $40m in 10 hours with about 36,000 transactions. The scheme involved attacks on two banks, Rakbank in the United Arab Emirates and the Bank of Muscat in Oman.
Such ATM fraud schemes are not uncommon, but the $45m stolen was at least double the amount involved in previously known cases, said Avivah Litan, an analyst who covers security issues for Gartner.
Middle Eastern banks and payment processors are “a bit behind” on security and screening technologies that are supposed to prevent this kind of fraud, but it happens around the world, she said. “It’s a really easy way to turn digits into cash,” Litan said.
Some of the fault lies with the ubiquitous magnetic strips on the back of the cards. The rest of the world has largely abandoned cards with magnetic strips in favour of ones with built-in chips that are nearly impossible to copy. But because US banks and merchants have stuck to cards with magnetic strips, they are still accepted around the world.
Lynch would not say who masterminded the attacks globally, who the hackers are, or where they were located.
The New York suspects were US citizens originally from the Dominican Republic who lived in the New York City suburb of Yonkers. They were mostly in their 20s.
Lynch said they all knew one another and were recruited together, as were cells in other countries. They were charged with conspiracy and money laundering. If convicted, they each face 10 years in prison.