Local case shows how hand-held device lets cashiers invade customer accounts
Skimmers prey on credit card users
Sabur Ali Brown spent a lot of money with credit cards.
The problem was, the credit cards weren’t his.
Helping the 21-year-old Cheektowaga man gain access to the credit cards was a small network of crooked restaurant cashiers and store clerks.
Brown, who also was involved with drugs and illegal weapons, is one of the first — if not the first — local person to be convicted of using a small electronic device called a skimmer to steal credit card information.
He is scheduled to be sentenced Jan. 22 by U. S. District Judge William M. Skretny.
Skimmer fraud is a growing international problem, according to police, and it all starts with a process that is so routine that it happens millions of times every single day at businesses all over the world.
A customer walks into a store or restaurant, makes a purchase and hands a credit card to a cashier. The cashier then swipes the card through an electronic device that reads the information on the card.
Usually the purchase is approved, but sometimes a dishonest cashier also swipes the card through a small, illegal, hand-held device called a skimmer.
This device — no bigger than a pager — steals information from the card and activates a form of identity theft that causes headaches for consumers and, in recent years, has cost credit card companies billions of dollars.
One such case involved Brown. The U. S. attorney’s office said Brown had cashiers in several local restaurants and at least one local department store helping him steal credit card information.
“After the persons assisting Brown had skimmed the cards of numerous customers, they would return the skimmer to Brown, who then would download the copied account information onto his personal computer,” Assistant U. S. Attorney Paul J. Campana said. “The cards of about 200 persons were skimmed, with losses up to $70,000.”
Campana said that, to his knowledge, Brown is the first person caught locally running a credit card skimming scheme.
Fraud experts say these scams occur every day — often on a much bigger scale — in businesses all over the world. Some of the skimming operations are run by organized crime.
“Credit card scams and shady waiters can easily turn customers into identity theft victims,” said Dawn Handschuh of CreditFYI.com, an online educational forum on personal finance issues.
“Credit card skimming occurs when someone swipes the magnetic strip on a customer’s credit card to get the account number with a device small enough to hide in a pocket or hand. It takes about two seconds.”
In Brown’s case, authorities say, he hired cashiers at local businesses to take skimming devices to work with them. When the cashiers handled a credit card purchase, they ran the credit card through the business’ legitimate scanning device and then, a second time, through the skimmer.
After the skimmer was returned to Brown, he used the information from the credit cards to activate gift cards obtained from local businesses. He then used the gift cards to buy iPods, clothing and other items, which he then sold on the black market.
Buffalo agents from the U. S. Secret Service arrested Brown in March, after he leapt from a second-story window of his Windward Court apartment. Agents from the Bureau of Alcohol, Tobacco, Firearms & Explosives and the Drug Enforcement Administration were also investigating Brown, who was caught with marijuana and a Colt .357 Magnum handgun.
In September, Brown pleaded guilty to felony charges of mail fraud and weapon possession. Under advisory federal guidelines, his minimum prison sentence would be three years and 10 months.
Authorities have not yet decided whether to file charges against the cashiers who worked with Brown, some of whom became witnesses in the case.
Skimmers such as the one Brown used usually cost a few hundred dollars and can be purchased over the Internet, police said. Some Web sites even offer information on how to make such a device.
Secret Service agents say they have no idea how widespread such scams are in the Buffalo area, but they and other law enforcement agencies say everyone who uses credit cards should be on guard for them.
Whenever possible, consumers should watch the store clerk or restaurant cashier who processes the transaction, these agents advise.
If the cashier slides your credit card through two different devices, that should raise an immediate red flag, and questions should be raised with a manager.
In Europe, a growing number of restaurants are fighting this form of fraud by using small portable devices that allow consumers to pay their bill at their table. A limited number of restaurants in the United States have begun using them.
Today it is more important than ever for credit card users to closely examine their monthly bills, checking for unauthorized purchases. Secret Service agents said a consumer should call the credit card company immediately to report any unauthorized purchases.
The bank that issued the credit card takes the loss, but only if a customer takes the initiative by checking his or her records and reporting unauthorized charges, one investigator said.
“Industry and law enforcement sources estimate credit card fraud losses exceed a billion dollars annually. And it’s no wonder why, when thousands of skimmed credit card numbers can be sold and e-mailed anywhere around the globe in seconds,” the Consumer Affairs office of the State of Georgia said in a recent advisory on skimming.
Skimming affects every consumer because fraudulent credit transactions are sometimes charged back to the merchant who accepted the card. The merchant ultimately winds up raising prices to make up for the losses, the Georgia office said.
Authorities also warn about a second form of skimming that does not require the participation of dishonest cashiers. Some skimming rings have learned how to install skimming devices on automated teller machines, gasoline pumps and other legitimate devices that read credit cards or banking cards.
According to federal prosecutors in Orange County, Calif., a man pleaded guilty in 2007 after agents learned that he put illegal skimming devices on gas pumps at several gas stations in the region.
The man admitted that he obtained credit card and debit card information from 90 customers and then used the information to steal $186,000 from his victims’ accounts.
“You want to check your credit card bills closely,” one Secret Service investigator said. “If you find out you’ve been billed for a $500 stereo that you never actually bought, you need to start raising questions.”
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