Have you ever had this happen….? You’re late for work and run into the driveway put the key in the ignition and start your car. Just another typical Monday except today you forgot you were low on gas. Grudgingly you run to the nearest station slam your debit card into the pay at the pump terminal, fuel up, and skate into work right on time. Whew …. But then a week or two later you see that your bank account has been all but drained with purchases you did not make… Your debit card was “skimmed” at a pay at the pump terminal. Credit and debit card fraud has been increasing at alarming rates as merchants in the United States make the transition to accepting EMV payments. Card issuing banks send out more EMV enabled credit and debit cards every day and more and more retail businesses are converting to EMV terminals. This progress is making it tough on criminals who profit from counterfeit credit and debit cards are finding it a lot harder to cash in on their loot which has been pushing them to different sectors. Meanwhile, petroleum merchant services are seeing huge jump in fraudulent activity with credit card skimmers.
A large portion of card fraud from counterfeit cards can be linked to the antiquated payment security at pay at the pump gas stations.
Ironically the drastic increase of card fraud in card not present environments like eCommerce as well as retail locations that have not taken the initiative to upgrade their systems to be EMV compliant are actually signs that the EMV Liability shift and transition to more secure payments is working! Just a few of the facts related to the recent EMV payment conversion are:
- 39% of Visa Credit and Debit cards are now EMV chip cards.
- 25% of U.S. Merchants are now accepting EMV payments
- The Card Brands report that dollar losses to credit and debit card fraud are down by approximately 26% and in its latest report MasterCard reported that a group of large merchants saw a decrease in dollar losses of almost 40%!
Clearly the move to chip cards combined with the increasing popularity of NFC payments has had a dramatic impact on credit and debit card fraud.
Many merchants are quickly realizing the impact that the EMV liability shift can have on their businesses. At this time, any merchant who has not yet upgraded their Point of Sale to accept EMV payments can be liable for any fraudulent transaction that takes place at their business.
This is of no comfort to consumers and gas station owners across the country. Skimming devices have been found at nearly every type of pay at the pump island – whether it’s a national chain in a major city or a mom and pop station in a small town. According to National Association of Convenience Stores (NACS) an undetected card skimmer is capable of capturing between 30 and 100 cards per day which can quickly lead to thousands of compromised cards from a single card skimmer.
Since the EMV transition for petroleum merchants is not scheduled until October of 2017, what can consumers and merchants do to minimize risk?
Tips for filling up:
- Pay inside, with cash or a credit card. A little less convenient than paying at the pump but the likelihood that your card information will be compromised inside the store is very low.
- Check the gas pump security seal to see if it is the same color as the other pumps, if it is broken or if the word “void” appears on it, or i f there is no seal consider paying inside. Although thieves are getting more advanced and have started creating their own security seals these steps will help you to identify a pump that has been tampered with. Please report to the station attendant immediately.
- Choose pumps closest to the physical building, not the ones hidden around the corner. These pumps are less tempting for criminals to install card skimming devices on.
- Always a credit card, not debit card, when you pay. Credit cards are protected by the bank’s policies and easy to freeze whereas a debit give the criminal access to your cash and is much more difficult to remediate.
- Pay attention to your gut when you are filling up – if it does not feel right simply pay inside. When thieves replace or modify the card reader often times it won’t feel quite right. The card could feel sticky or just not smooth when you insert it. If that happens just cancel the transaction and pay inside. Better safe than sorry!
Tips for petroleum retailers
The National Association of Convenience Stores and Conexxus have compiled a list of best practices for retailers as well. On the NACS’s website there is a skimming resource guide. Additionally in 2012, Conexxus set up a database available to members that enables retailers to report and track skimming incidents.
Conexxus encourages retailers to follow a list of Best Practices:
- Change the locks on gas pumps – the locks that come stock on most pumps are generic and often times one key fits all.
- Use and track pump security seals. These large labels are adhered to the pump, near the credit card reader. If the pump is opened, the label will read “void,” or are designed to break easily to indicate when a machine has been tampered with.
- Immediately shut down and bag suspect pumps, and have the machine checked for skimmers. Have a procedure for your employees to follow when a skimming device is suspected.
- Make pump inspection part of the daily routine for employees. Always make sure that the serial numbers of the stickers on the pumps match those in your logbook to avoid overlooking counterfeit seals.
If you are frustrated with paying for fraudulent transactions, EMV non compliance penalties, or are just looking for a petroleum merchant service provider who understands the challenges of your business, give Bankcard Brokers a call. Not only can we help you with setting good policies but we have the most competitive rates on petroleum merchant accounts combined with the world class service that your station or stations deserve. Gas station payment processing.