OUTLOOK — By Mohammed Al Balushi — Creative ideas always govern the world. In 1939 a Turkish man, named Luther Simjian came up with an idea of having a hole-in-the-wall machine that would allow bank customers to make their financial transactions. However, this dream came true in the late sixties when Barclays bank first installed the Automated Teller Machine (ATM) in United Kingdom. Currently, there are approximately 1.6 million ATMs in the world. It is witnessed that the technology has brought many changes in business life.
Through ATMs customers do many banking transactions, such as (Cash withdrawal, cash deposit, cheque deposit, transferring funds from one account to another within the same bank, request for mini statement, change password, payment of utility bills, and many others). Launching ATMs in banking sectors is one of the great revolutions where people save time and allows banks to focus on customers’ care. ATMs have reduced the crowd in bank branches, which is an advantage for it gives the branch staff and the management time to think more strategically on how to bring new business and introduce new schemes for valuable customers.
Valid questions that might be asked are: Are customers’ finance and lives really safe by doing the banking transactions through ATMs? Will banks lose money if there is a fraud in ATMs? Banks and their customers have been victims in many countries in the world in ATM frauds. According to a 2010 study conducted by the Association of Certified Fraud Examiners (ACFE), organisations worldwide lose an estimated five per cent of their annual revenues to fraud. An ATM fraud is one of those.
Fraudsters have their own tips and strategies to commit ATM fraud. One of the first ATM fraud occurred in 1993 in Manchester, in United Kingdom, where a gang installed a fake ATM in the shopping mall to steal customers’ information, and the plan succeeded.
There are several techniques which thieves use for ATM fraud. For instance the Lebanese loop: where you try to insert your ATM card into the machine and you face some technical errors in the machine and meanwhile a stranger comes and offers you a help saying: “I faced similar problem” and asks you to reinsert your card and Personal Identification Number (PIN). He notes your PIN while you are attempting to do the transaction. Finally, your card gets stuck without completion of the transaction. You assume that the card is stuck while in reality it has not.
The stranger has set the ATM machine like that. Once you leave, he will come and take out the card and the PIN which has already been noted by him.
At the end you will become a victim. Some of the ATM fraud techniques are card jam, card swap, violence, where you are physically attacked by fraudsters who damage the ATM.
Like many countries’ ATMs, Oman’s ATMs were also attacked by fraudsters. In 2008, as reported by authorities concerned 37 bank ATMs were detected with scamming devices. In 2011 the same incidents occurred again.
Combating ATM fraud is a great challenge for banks. Initially, it is the banks’ responsibility to educate their customers, because most of the customers don’t know banking transactions and they also don’t know what the risks are while doing banking transactions through ATMs.
Banks are entitled not only to sell their products but also to safeguards customers’ deposits, provide financial advice and make customers understand everything regarding their products and services. ATM is one of the facilities provided by banks to their customers, which has a little risk.
Therefore, banks should educate their customers on for example; What is an ATM? Why use an ATM? How to use an ATM card? How to secure your PIN? What to do when the ATM card is lost?
Customers do have some responsibilities too, to safeguard themselves and their money against robbery. They must carefully listen to instructions they receive from banks and adhere to and ask the right questions so as to not become victims.
One of the important elements in combating ATM fraud is the awareness. Banks should begin creating awareness to their valuable customers covering entire Oman, and citizens should make an effort to update themselves on what’s happening around the world. They should ask and share information with others.
The authorities concerned always played a vital role safeguarding Oman and its public. It will be advisable if these authorities come forward as usual and create more awareness for the same.