The Agency Insider with Linda McGlasson

Minn. Cracks Down on Skimming

Minn. Cracks Down on Skimming

This new law now makes even the possession of a skimming device or a re-encoder a punishable offense, meaning over one year imprisonment and up to a maximum fine specified by law.

The state's move means the unauthorized scanning and recording of personal information from the magnetic strip of a credit card, or ATM card now carries a heavy penalty.

Currently, 31 states have laws on their books regarding card skimming, including Washington and California. 

The law was sponsored by State Rep. Debra Hilstrom. The bill, HF2470, makes it a felony for someone to use a scanning device or re-encoder to acquire information from payment cards, a driver's license or state-issued identification card with intent to commit a crime. "This is getting to be a very serious issue," Hilstrom says. "We need to allow folks to prosecute for having this material."

This law puts a real crimp in a criminal's work, at least in Minnesota. Skimmers are small -- many are the size of a small lighter. They are hard to spot, so it is very easy for someone (either by coercion or willingly) who works in the food or hospitality industry to "palm" one and swipe cards. Numerous cases, including the fraud spree reported earlier this week and the pay-at-the-pump skimming incidents hitting gas stations around the country, have the attention of consumers and retailers.

In Minnesota, card skimming is in play with criminal groups getting servers working in local restaurants to steal card information. Two such cases were reported this year at a St. Louis Park, MN Olive Garden and a Coons Rapid, MN TGI Friday. Both crimes racked up thousands of dollars in fraudulent charges against customers' accounts.

The Minnesota law also applies to the types of skimmers that capture card data at ATMs. Industry experts say that the ATM skimmers are getting more sophisticated and harder to detect.

Currently, 31 states have laws on their books regarding card skimming, including Washington and California. But additional states need to follow Minnesota's move and enact legislation to bring the skimmers to a halt -- or at least have some serious penalties facing the fraudsters when they are caught.

Your thoughts on what would make effective legislation?

About the Author

Linda McGlasson

Linda McGlasson

Managing Editor

Linda McGlasson is a seasoned writer and editor with 20 years of experience in writing for corporations, business publications and newspapers. She has worked in the Financial Services industry for more than 12 years. Most recently Linda headed information security awareness and training and the Computer Incident Response Team for Securities Industry Automation Corporation (SIAC), a subsidiary of the NYSE Group (NYX). As part of her role she developed infosec policy, developed new awareness testing and led the company's incident response team. In the last two years she's been involved with the Financial Services Information Sharing Analysis Center (FS-ISAC), editing its quarterly member newsletter and identifying speakers for member meetings.

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