Godfrey Sigwela
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Modern banking thwarted by the 'Lebanese Loop' swallowing ATM cards in South Africa

Port Elizabeth, South Africa Investigative Reporting April 19 @ 5:23pm

Caption: Shoppers still get their money from the banks in South Africa. Photo by Godfrey Sigwela


YEARS ago people living in rural areas of South Africa used to bank their money under the bed or inside the mattress. Some would go an extra mile and dug a hole at the back of the corner yard and bank the money underground.

All those attempts were based on saving the money for the future. But also to protect it from the suspected family thieves or from the neighborhood alleged thieves.

But gradual technical developments led to the introduction of the banking approach. Even then it was not easy to convince the old man of the family to dig out his money and gave it to another unknown person to keep it for him.

Even the old women who used to keep their money inside the mattress or tied it up on handkerchief are still reluctant to bank their money to the bank tellers.

In fact most of the South African people are still stubborn to use the modern banking systems. Among the things they are afraid of is the actual process of doing deposits. As well as withdrawals from the ATM as they are scared to be robbed through digital banking technology.

Nevertheless, South African Banking Risk Information Centre (SABRIC), warned that there are skillful thieves who are able to steal the money from the ATMs.

SABRIC confirmed that criminals can also use the client's information stored in personal computers or cellphone to steal the money from the bank.

According to SABRIC one of the techniques used by the ATM thieves is called the 'Lebanese Loop'.

SABRIC media communications liaison manager, Louise van der Merwe said: "South African banks deploy robust cutting edge technology in order to protect the bank clients against crime. But the criminals use their technology like the 'Lebanese Loop' to trap a bank card inside the ATM.

"They allegedly inserting a thin film of plastic into the ATM card slot. The plastic is rigged in such a way that both the plastic and trapped card can later be removed.

"The victim transacts at the ATM, then get the cash and receipt provided. But the card remains trapped inside. Once the victim leaves ATM, the criminal who has saw the victim PIN at a closer range, would return and removes the trapped card and uses it along the PIN to withdraw money immediately."

Also criminals can skim bank cards at the ATM.

She said: "Criminals also are using ATM mounted skimming devices. This device is mounted over the ATM card slot and it look like a card reader slot, making it difficult to detect. With a means of a spy camera on the skimming device, a PIN and the magnetic strip data on the card can be comprimised."

There are few tips one may observe to reduce banking fraud.

She added: "Toll free numbers are displayed on all ATMs and report any suspicious things on ATM. Avoid faulty ATMs looking dimly or surrounded by the loiterers. Do not send passwords or account login credentials over public or unsecured WiFi networks."
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