Thieves Used 3D Printer for ATM Skimmers

3D printing in action from i.materialise on Vimeo.

Most ATM skimmers are carefully hand-made and crafted to blend in with the targeted cash machine in both form and paint color. Some skimmer makers even ask customers for a photo of the targeted cash machine before beginning their work.

The skimmer components typically include a card skimmer that fits over the card acceptance slot and steals the data stored on the card’s magnetic stripe, and a pinhole camera built into a false panel that thieves can fit above or beside the PIN pad.

If these components don’t match just-so, they’re more likely to be discovered and removed by customers or bank personnel, leaving the thieves without their stolen card data.

Enter the 3D printer. This fascinating technology, explained succinctly in the video below from 3D printing company i.materialise, takes two dimensional computer images and builds them into three dimensional models by laying down successive layers of powder that are heated, shaped and hardened (see video).

The word is spreading in the cybercrime underworld that 3D printers produce flawless skimmer devices with exacting precision. Last year, i-materialise blogged about receiving client’s order for building a card skimmer.

The company said it denied the request when it became clear the ordered product was a fraud device.

A convicted skimmer in the US is alleged to have used the counterfeit cards to withdraw funds at different ATMs around Texas. Prosecutors allege the group stole more than $400,000 between Aug. 2009 and June 2011.

Prior to their arrest this summer, the gang started making decent money but they split the profits between them. Federal prosecutors say the men stole $57.808.14 in month of April 2011 alone.

Read more on this article here

Marin County sues Deloitte: Alleges fraud on SAP project | ZDNet

Marin County sues Deloitte: Alleges fraud on SAP project

In a case that has the potential to reshape important aspects of the systems integration business, Marin County, California filed a complaint against Deloitte Consulting for its role in an over-budget SAP implementation. The lawsuit alleges that Deloitte committed fraud and “misrepresented its skills and experience.”

Here is an overview of the case:

Marin County on Friday filed a lawsuit against Deloitte Consulting alleging fraud related to an SAP ERP software implementation the county said is still not working four years after it initially went live.

In its lawsuit, filed Marin County Superior Court, the county is asking for actual and compensatory damages of at least $30 million, along with unspecified punitive and, or exemplary damages and interest.

Deloitte in turn filed a claim on Friday with the Marin County Board of Supervisors that the County owes it $444,171.50 for work completed, plus an additional late charge of $111,713.80.

This quote, directly from Marin County’s court filing, alleges fraud:

Deloitte mounted an extensive sales campaign to be hired by the County. As part of its sales efforts, Deloitte repeatedly represented to the County that Deloitte consultants had the requisite skills and experience to successfully implement a complex ERP software product specifically designed for public sector entities, developed and licensed by SAP AG and SAP America, Inc. (”SAP for Public Sector”). Deloitte further represented that for the County’s SAP implementation, Deloitte had assembled a team of its “best resources” who had “deep SAP and public sector knowledge.”

These representations were fraudulent.

The complaint emphasizes that the system integrator was aware of Marin County’s lack of skill, experience, and capability to manage a complex ERP implementation. In non-legal terms, the complaint suggests that Deloitte lied to Marin County in order to make the sale:

Indeed, at the time Deloitte made [the representations], it knew that it did not have the ability or intention to provide the skilled resources necessary to deliver a successful SAP implementation for the County. Deloitte also knew that because the County did not have any prior ERP implementation experience in general, or SAP experience in particular, it would be depending on Deloitte to oversee, guide and manage the project. Notwithstanding such knowledge, Deloitte made these false representations in order to obtain the contract for the County’s lucrative SAP project.

THE PROJECT FAILURES ANALYSIS

The lawsuit reads like a caricature of many IT 'Devils Triangle' problems I discuss in this blog, and lists a catalog of alleged IT services failures.

For example, the complaint states that Deloitte mishandled staffing, project management, risk management, and testing:

As part of its fraudulent performance of the contract, Deloitte: intentionally and/or recklessly failed to disclose to the County that Deloitte’s lack of SAP public sector skills resulted in a defective SAP system; withheld information about critical project risks; falsely represented to the County that the SAP system was ready to “go-live” as originally planned; conducted woefully inadequate testing; and concealed that it had failed to perform the necessary testing, thereby ensuring that system defects would remain hidden prior to the go-live.

According to the complaint, Deloitte failed to fulfill core system integrator responsibilities required on a project of this type.

Customer Service versus Fraud Management

Ooops! Accidents will happen but sometimes they may not be what they seem.

Price and customer service have always been the two biggest influencers behind the purchase of insurance, and insurance companies are seeing this trend increase significantly. This is partly as a result of current tough economic conditions and partly from the emergence and availability of new distribution channels for customers.

Insurance companies can offer very little by way of flexibility on pricing structures, and the provision of enhanced or better customer service is an issue facing increased scrutiny in the boardroom.

Also, insurers are facing an ongoing battle against insurance fraud - an issue that according to the ABI, costs the industry $1.6bn a year.

The need to provide policyholders with an efficient and positive claims experience, as well as managing fraud effectively, has proved to be a big challenge for the industry in recent years as fraud increases and fraudsters become more sophisticated.

Forensic Psychology
Since the introduction of forensic psychology to the insurance market in 2001, the adoption of 'cognitive interviewing' has grown rapidly as a means of detecting honesty and combating fraud in a more empathetic way. Perhaps its success is not surprising because this is a common sense approach to comfortably extracting information, which complements the service delivered to the genuine policyholder.

Cognitive Interviewing
Cognitive interviewing is a system which incorporates a number of key components. Since 2001, when it was introduced into the insurance industry, cognitive interviewing has been further refined.

Today, it draws on advanced forensic psychology, behavioural psychology, advanced conversation management, communication techniques and experience, in identifying and anticipating fraud trends.

Rapid Detection of Honesty
The key is to identify honesty rapidly, and fast tack genuine claims through to settlement whilst simultaneously pinpointing fraud and extracting the evidence to robustly repudiate such claims.

The methodology has also evolved to cater for, and manage, claim volumes with no loss of service or fraud identification. Commercial advantage can consequently be realised in terms of cost and the ability to ramp up the service as required. This is a real bonus.

FSA Regulations
As well as helping to enhance the customer service experience during the claims process, cognitive interviewing can also play an intrinsic role in supporting FSA regulations and TCF guidelines.

The methodology of obtaining information at the outset of a claim rather than weeks or months down the line when it has been flagged as high risk, is a natural complement to best practice and TCF guidelines. The cognitive process leads to early decisions with no need to keep referring back to various parties for additional information.

The industry as a whole recognises that working collaboratively is vital to combating fraud, yet historically there has been a deep mistrust between brokers and insurers in handling suspected fraudulent claims.

BIBA Survey
In last year's BIBA survey, it was reported that insurers tend to bypass brokers when dealing with suspicious claims because they feel they are obstructive when it comes to identifying fraudulent policyholders. Brokers, meanwhile, have concerns about the impact of fraud investigations on policyholders' customer service aligned to the claims experience.

Fraud Detection Tool
Forensic psychology as a fraud detection tool can help brokers and insurers to work together in collaboration throughout this sensitive process. Cognitive interviewing meets the needs of both insurer and broker alike, enabling a joined up approach which drastically reduces claims spend in relation to fraud whilst simultaneously delivering strong customer service to policyholders.

Protecting the Bottom Line
This joined up approach shields genuine policyholders from the additional costs of fraud, supporting FSA guidelines, whilst at the same time protecting the bottom line of both broker and insurer businesses. Policyholders value the fact that they are being protected from unnecessarily high premiums through the proactive pursuit of fraud and the swift resolution of genuine claims is a powerful reputation booster.

The significance for insurers of adopting empathetic methods of fraud management that will impact positively on both customer service and the bottom line cannot be overestimated and
this is a trend that is definitely here to stay.

On of the more popular versions of this Fraud Detection system is Absolute's Flatline