Information Sharing, Technical Standards Are Primary Goals
ATM manufacturers Diebold Inc. and Wincor Nixdorf AG are laying the groundwork for the formation of a new global industry group focused on thwarting ATM crime.
While experts say the time is right for a group like this, it will need industrywide buy-in to be successful.
ATM Crimes on Rise
ATM skimming attack sophistication, and recent global upticks in ATM cash-out schemes, have put a spotlight on ATM-related fraud, the two companies say. Banking institutions, in particular, have struggled to keep up with some of these emerging ATM fraud schemes.
The aim of this group is to establish industrywide technical standards for secure ATM terminals and ATM components and provide a platform for information sharing about attack scenarios and emerging threats, says Joerg Engelhardt, vice president of global product management for Diebold.
Members of the group will be provided with recommendations about how to prevent ATM attacks and mitigate their risk, he adds.
"The primary focus will be on both ATM hardware and software-related threats," he says. "Input regarding broader ATM security focus areas and priorities will be established by the association's membership."
Engelhardt says the new group, which is not yet formally named, is inviting other ATM manufacturers, as well as banking institutions, IT service providers and ATM suppliers, to join.
"Currently, we have documented interest from six ATM manufacturers, several financial institutions and several ATM security providers," Engelhardt says. "Additionally, ATM network providers have expressed interest in participating. Other security associations have also approached us for participation."
But David Tente, North American executive director of the ATM Industry Association, or ATMIA, says he suspects the new group will likely stay focused on ATM security products and solutions. "It is my understanding that this is more of a business/product relationship than it is an industry group," he says.
Both Diebold and Wincor currently sit on ATMIA's security committees, Tente adds.
ATMIA, which has a paid member base, also provides ATM crime information sharing through its Global ATM Security Alliance. But access to the alliance is only offered to paid members.
Formative Stages
Whether membership in the soon-to-be-formed ATM security group that Diebold and Wincor are launching will be fee-based has not yet been revealed. The group is still in its formative stages, Engelhardt says.
For now, the focus is on ensuring industry engagement in the group, he says.
"As ATM networks have expanded worldwide; so has the sophistication of global crime," Engelhardt says. "The combination of these factors has led to intensified security concerns at the ATM. Combating this issue requires consistent focus and global defense throughout the ATM-provider chain. It is necessary to form an association focused on this issue to compile information about recognized and potential attack scenarios against ATMs, and share the right information with the right people within the industry to develop actionable plans to combat ATM crime on a global scale."
Al Pascual, practice leader of fraud and security at consultancy Javelin Strategy & Research, says getting the right amount of industry engagement from established ATM players will be key for this new security group's success.
"In order for this group to be truly successful, they will need to work hand-in-hand with financial institutions and other fin-tech providers," Pascual says. "This is a necessity, considering the growing complexity of the threats affecting the ATM channel, which include malware directed at the machines themselves, along with institutions and processors. As an often unattended channel, ATMs are likely to garner continued focus from criminals with feet on the ground, especially as EMV will effectively shut down counterfeit fraud at the POS [point-of-sale] over the next few years in the U.S."