Have you paid for gas recently at the pump where you’ve had to swipe your credit or debit card?
At gas stations across the U.S., criminals are skimming cards and stealing payment card data from consumers paying at older fuel pumps. This is because the majority of fuel stations still use insecure outdoor fuel pumps with point of sale (POS) systems that read the magnetic stripe on the back of a payment card to process the purchase of gas instead of POS systems that use more secure EMV(R) chip card readers.
In fact, the U.S. Secret Service estimates that roughly 20 to 30 skimmers are discovered a week on fuel pumps, with an average of about 80 payment cards copied on it when the skimmers are removed. Stolen payment account information can be subsequently printed onto duplicate credit or debit cards, and used by criminals to make unauthorized purchases at stores and fuel pumps that do not have chip-enabled POS systems – draining a cardholder’s checking or savings account or maximizing their credit card balance. The industry calls this counterfeit payment fraud or counterfeit card fraud.
Currently, counterfeit payment fraud experienced by fuel merchants at the pump is absorbed by the financial institution that issued the payment card to the consumer.
That’s about to change.
Fraud dollars may be absorbed by independent and franchise owners of fuel stations on Oct. 1, 2020 if their pumps are not upgraded to process chip cards. Depending on how much fraud a station experiences, it could become a significant burden to station owners.
But this can be avoided.
For Visa cards, liability for fraud dollars stays with card-issuing financial institutions and does not shift to station owners if fuel pumps are chip-enabled.
Chip technology is proven to prevent counterfeit fraud. In fact, according to payment company Visa, non-fuel merchants that are chip enabled have experienced a significant 81 percent decrease in counterfeit fraud dollars. However, troubling statistics show only about 7 percent of fuel pumps nationwide are processing chip transactions.
For station owners, there’s no time to waste — contact your hardware or fuel provider for information on how to upgrade your pumps. For consumers, make sure to pay with a chip card at a fuel pump that is chip-enabled. If you’re not sure if the pump is safe, pay inside with your chip card.