Defending Against Transaction Reversal Fraud

INETCO Insight 7 Webinar on Fraud Prevention and Detection
Register now for the upcoming webinar, “Unveiling INETCO Insight 7: The next generation of real-time fraud detection and prevention“.

Your neighborhood ATM has always been a tempting target. From a physical attack standpoint, enterprising fraudsters drill holes to get at the USB slot, hide skimmers in the card readers, hammer them with bull dozers and explode them with bombs. They also play on the vulnerabilities of the cash dispenser, and one variation of that is Transaction Reversal Fraud (TRF). A form of a TRF attack, reported by NCR to have recently occurred in the United Kingdom, Ukraine and Canada, looks like this:

  1. A card and correct PIN are entered into the ATM
  2. A cash withdrawal is requested
  3. Cash is positioned behind the dispense shutter while the transaction in being authorized
  4. When the card is ejected from the ATM, the card is left in the slot until the transaction is timed out
  5. When the ATM tries to recapture the card, the fraudster introduces a fault at the ATM card reader, such as using a tool to hold the card in the reader
  6. A card jam is then reported and since no cash was dispensed, the ATM host application software logic reverses the card transaction
  7. The cash dispenser is then jammed open and the money positioned for dispensing is removed by the fraudsters – before the ATM has a chance to put the cash into the dispenser reject bin

In summary, a TRF is a sophisticated attack involving a sequence of events that generate multiple error codes and an unnecessary payment reversal. These attacks can be tricky to isolate and detect before financial losses occur, especially if changes to the ATM host applications are required. So what can you do to win?

To detect and block TRF before major damage is done requires a powerful combination of real-time transaction data, multi-link transaction profiling and a customizable rules-based alerts engine to:

  • Independently confirm that your ATM host applications are checking the currency dispenser status prior to approving the reversal of any transaction
  • Quickly identify and research transactions associated with specific error codes
  • Immediately flag reversal transactions, especially those that exceed specified withdrawal amounts or volume/velocity thresholds

It is impossible to prevent fraudsters from trying to pry open a cash dispenser, but with real-time access to the right data, you can gain the precise information needed to immediately detect TRF and protect (or even shut down) ATMs in seconds. With a solution that ensures every payment transaction is independently captured, every message field is fully decoded and every transaction link is correlated, you gain access to the underpinning data required to add real-time intelligence and visualization to your payment fraud strategy.

If you would like to know more about the fraud configuration features that will be unveiled in the new INETCO Insight 7 payment data acquisition and machine learning platform, we invite you to attend this 45 minute webinar on Tuesday, October 1st.  Alternatively, if you cannot make the webinar and just want to talk about where real-time fraud detection and prevention solutions are going, email me – I’d love to hear from you.

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