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Fraud and Fraud Detection: A Data Analytics Approach, + Website by Sunder Gee

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CHAPTER 7 Skimming and Cash Larceny

WHEN WE HEAR ABOUT skimming fraud in the news these days, it is usually related to the theft of credit or debit card information using an electronic device that skims or reads and stores customer credit card information from the magnetic stripe on the cards. With the advent of chip technology, where the customer has to enter a personal identification number (PIN) to complete a transaction, skimming magnetic stripes has moved on to skimming radio-frequency identification (RFID) tags information embedded in new credit cards. RFID transactions are for small currency transactions that need no signature or PIN.

When we speak about skimming, we are talking in the more traditional sense of removing cash prior to the cash being entered into the business system. This differs from cash larceny where the cash is stolen after it is recorded in the business system. Because of the recording processes, larceny is much simpler to detect than skimming as it leaves audit trails.

inlinedbox SKIMMING

Any employee who handles cash is in a position to skim. This includes bank tellers, sales staff, waitstaff, parking attendants, apartment managers, and others whose duties include the collection of cash from customers.

It is not only employees that may skim, but owners of the business have incentives to skim also. It may be to reduce obligations such as retaining sales taxes ...

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