March 21 -- California experienced an uptick in card and PIN skimming at free-standing and bank-owned ATMs during 2012, according to data released this week.
FICO, a software company that provides credit scores and fraud detection services, on Tuesday released data showing a national uptick in card and PIN skimming at free-standing and bank-owned ATMs during 2012. California, in addition to Florida and the Northeast, was among the hardest hit, the analysis said, especially in Los Angeles, Riverside, San Diego and San Bernardino counties.
Credit card fraud is down in California almost 9 percent, but FICO found skimming to be up particularly at ATMs, said John Buzzard, product manager for the company's Card Alert Service. The service analyzes 65 percent of ATM transactions across the country each day.
In Southern California, 54 percent of debit card fraud cases analyzed by the company took place at ATMs, with the rest originating at retail point of sale systems. The high amount of traffic at ATMs and the fact that consumers input their PIN is often a draw, he said.
"That makes it the perfect place for a criminal to place skimmers," he said.
Skimmers tend to be nomadic to avoid the extra attention of local law enforcement and consumer awareness, he said, and in recent years criminal activity had moved from California to the East Coast.
"Now we're seeing that migration back to the West again," he said.
In Orange County and surrounding areas, it's a crime of opportunity, experts said. On-the-go residents are turning to ATMs more than ever, and thieves see higher returns for less risk in the technologically sophisticated crime.
"It's an extremely profitable way for crooks to do business," said Elizabeth Henderson, an Orange County assistant district attorney in the major fraud unit.
Skimming operations can be complex, and several recent cases have had connections to international organized crime, she said. Thieves affix card readers and in some cases keypads over existing equipment that sees large amounts of use. When a customer swipes a card, the skimmer copies the information in the card's magnetic strip.
"All your information is contained within that strip," she said.
The information might then be sold to criminals in another state or outside of the U.S., she said. Its contents can be copied onto a new card, allowing thieves to withdraw cash or run up purchases on credit. Consumers might not notice unusual transactions until months after the initial security compromise, she said. That can make the crimes difficult to track, and the Orange County District Attorney's office has worked with law enforcement from around the country and internationally in its prosecutions.
Some former street criminals have turned to identity theft over robbery and burglary, she added.
"It's sad, but true," she said. "There's less chance of them being caught doing identity theft."
Orange County and the surrounding region offer some particularly appealing characteristics to criminals.
"The Southern California population is really mobile," Henderson said.
Gas stations and ATMs are the starting point for the largest local skimming operations, she said. Residents depend on ATMs and often pay at the pump with plastic. Many people have multiple credit cards, and the area is home to people from around the world -- some of whom have ties to the international groups behind skimming operations.
"That creates a lot of targets and locations where they can operate," she said.
The usage of ATMs has also risen in recent years, which may account for the increase in fraud, said Beth Mills of the California Bankers Association. The financial industry continually is working on improving ATM security, including upgrading hardware and software. Banks have also taken measures improve security around ATMs, such as installing surveillance cameras and increasing lighting.