Apr 17, 2024

Fleets and Suppliers Collaborate to Combat Fuel Card Skimming Threat

In recent years, there has been a growing concern among fleets and their suppliers about the increasing threat of fuel card skimming. This suspicious activity or criminal activity involves the illegal installation of devices on fuel pumps that can steal credit card information from unsuspecting customers.

These devices are often difficult to detect and can result in significant financial losses for both fleets and their suppliers. To combat this threat, there has been a significant push for collaboration and cooperation between fleets and their suppliers.

By working together, these two entities can share information, implement preventive measures, and ultimately reduce the risk of fleet fuel card skimming.

In this article, we will explore the current state of fuel card skimming and the efforts being made by fleets and suppliers to combat this threat.

We will also discuss the importance of collaboration and how it can lead to effective solutions in the fight against fuel card skimming.

A Major Challenge

Fuel card fraud poses a major challenge for carriers, both in terms of fitting it into their budgets and dealing with the fraudulent payments. Cybercriminals target fleet drivers through phishing schemes, stealing their payment card PIN codes and identities. However, the most daunting and costly scam of all is fuel card skimming.

This clever scheme involves scammers installing deceptive card readers at truck stop fuel pumps, fooling drivers into thinking they are legitimate. These fraudulent devices collect the payment card information, which is then used by the thieves to make unauthorized purchases until the fleet manager catches on and deactivates the card.

Hemant Banavar, the VP of financial products at Motive in San Francisco, highlights the problem's severity, exacerbated by the lack of innovation in chip technology.

"Unfortunately, some of the cards currently available on the market lack the necessary safeguards to prevent skimming," Banavar explains. "These outdated magnetic strip cards lack the advanced security measures found in chips."

Stay ahead of the game and protect yourself from fuel card scams by being vigilant and embracing the latest chip technology to outsmart the cybercriminals.

Nevertheless, cunning fraudsters cunningly exploit situations wherein motorists are dependent on the magnetic strip due to the chip reader's failure or inactivity. Banavar asserts that incorporating a range of multifactor authentication techniques, coupled with the imminent integration of AI and machine learning, expeditiously identifies any irregularities that could potentially flag fraudulent activities.

Driver Frustration

Fuel card skimming can cause major headaches for fleet owners, especially when it occurs at the gas pump, a common target for these criminals. Detecting fraud means locking the card, which then requires the dispatcher to find alternative payment methods for the driver. This can be a real hassle for everyone involved.

Milo Dubak, CEO of Pure Freight Lines, learned this the hard way. Fuel card skimming was happening to his fleet on a weekly basis, resulting in up to $10,000 in fraudulent charges each month. Cancelling the fuel cards and investigating the drivers' whereabouts became a routine, albeit uncomfortable, task.

To combat this issue, Spencer Barkoff, president of Relay Payments, suggests eliminating the physical card altogether. Instead, drivers would go through a series of prompts and security questions before entering a code directly into the pump to purchase fuel at a discounted rate.

This system, integrated with electronic logging devices, would closely monitor the purchase process, making it difficult for scammers to operate.

Relay has partnered with Pilot Flying J to implement this system, providing drivers with access to pre-negotiated discounts. Barkoff claims that they have successfully helped trucking companies of all sizes eliminate their reliance on fuel cards and fleet checks.

For drivers still using fuel cards, spotting skimming devices can be a challenge. Often, these devices are placed on top of the actual card reader, making them difficult to detect at first glance. However, with a closer inspection, discrepancies like the device being slightly off-center from the pump can be noticed.

In conclusion, fuel card skimming is a serious problem for fleets, but innovative solutions like those offered by Relay Payments and Pilot Flying J are helping to eliminate the reliance on physical cards and improve layer of security measures.

Don't be fooled! Pump up your wits and stay one step ahead of those sneaky scammers. You see, most pumps out there try to play it safe with a snazzy security tape wrapped around their cabinet panel, but hey, that's not foolproof.

Those crafty con artists can easily snag their own tape online and slap it on after they've done their dirty work installing a skimmer device. But wait, there's a clue! If that tape boasts the logo of the fuel company running the joint, chances are it's the real deal.

However, if it's logo-less, my friend, it's time to be on high alert. So, beware the tape game, folks! Stay sharp and keep your hard-earned cash where it belongs – in your pocket!

Finding Solutions

In 2021, Evans Delivery, a container drayage carrier based in Schuylkill Haven, Pa., found itself trapped in a never-ending nightmare. Card skimming had become a daily struggle, plaguing the company with fraudulent charges ranging from $30,000 to $60,000 each month.

It was an absurd level of fraud that left the fleet's manager, Meghan McBride, overwhelmed and consumed by the constant task of replacing compromised cards.

As one of the top for-hire carriers in North America, ranked No. 23 on the Transport Topics Top 100 list, Evans Delivery couldn't afford to let this fraud continue to run rampant. Thankfully, they had already partnered with WEX, a company based in Portland, Maine, to manage their payment card program.

While WEX had been covering the fraudulent charges, the administrative nightmare still plagued Evans Delivery.

Came to the Rescue

However, in the summer of 2023, WEX came to the rescue with a revolutionary solution that put an end to all fraudulent purchases made using Evans Delivery fuel cards. This solution provided fleet managers, like McBride, with the flexibility to control spending and assist drivers while ensuring secure fuel purchases across multiple TMS platforms.

It also offered real-time truck location tracking, ensuring that every transaction aligned with the truck's whereabouts. If anything seemed fishy, WEX would simply deny the request.

But that's not all – WEX's system went above and beyond. It identified geographic hot spots where fraud was most prevalent, down to the exact gas stations and pumps. This groundbreaking feature allowed a dedicated team to investigate these locations and eliminate any fraudulent devices, leaving Evans Delivery with peace of mind.

With WEX's innovative technology and unwavering commitment to tackling card skimming head-on, Evans Delivery emerged from the dark depths of fraud and into a brighter, more secure future. They can now focus on what they do best – delivering containers with confidence and leaving the nightmares of card skimming behind.

Drivers Had To Call A Number

When Evans first introduced their system, drivers had to call a number to obtain a passcode. But as the product evolved, they could simply log into an app using a default passcode, which often turned out to be their payment card number.

Unfortunately, there were some hiccups along the way. Some drivers would only enter the last four digits of their card number, resulting in them getting locked out of the system and requiring assistance from EFS.

There was also a bit of a learning curve for fuel station cashiers. McBride would find herself on the phone, guiding them through the process of locating the necessary information on their computer screens.

To combat fuel card skimming, Evans had to train their drivers in stages. It wasn't until the entire implementation was complete that they finally managed to eliminate the issue. Since then, there hasn't been a single instance of fraud, according to McBride.

A Quick and Lucrative Criminal Act

The audacity of illegally installing a device on a fuel pump at a truck stop might astound some, but in reality, it's a quick and lucrative criminal act. Estimates suggest that once a skimmer is installed, it can start gathering card information from users within a mere 17 seconds.

Given the combination of physical tampering and digital tools involved in this fraud scheme, fintech companies are going all out to fight back. One approach is using geofencing to deactivate cards.

Banavar from Motive highlighted that they employ AI and machine learning to detect suspected skimming by identifying irregularities in tank levels. "Fuel tank levels are unpredictable," he explained. "Fuel is just a liquid sloshing around in a tank, and we can determine if a transaction seems off, like if it claims to be for 100 gallons but registers as 120 gallons."

Motive's system also alerts them when a card assigned to a driver, or something that appears to be that card, is being used for numerous transactions far away from the vehicle's actual location.

"If the transaction happens to occur 100 miles away from the actual location, or even just 1 mile away, we've got our fraud radar buzzing," declared Banavar. "Imagine this: the transaction originates from a Love's in Oklahoma City, but hold up, the driver is actually cruising somewhere in Texas!"

Emphasized the Infuriating Reality

Barkoff, on the other hand, emphasized the infuriating reality of fuel card skimming frauds that trap fleets in a never-ending loop of excessive expenses, ultimately wreaking havoc on their business.

"In the trucking industry, it's like a never-ending nightmare. You face a whopping $10,000 fraud claim, and guess what? The trucking company has to dig into their pockets, pay the bill upfront, and then they have to beg their billing card company for reimbursement," he explained, his frustration palpable. "Here's the kicker: the whole process can drag on for days before the merchant and the billing card company decide if they'll cover the fraud.

Meanwhile, the poor company is left high and dry, struggling to keep their cash flow intact. I've even witnessed companies going under because of this relentless madness."

In Conclusion

With fleets and suppliers working together, the fight against fuel card skimming is gaining momentum. This partnership is crucial in protecting businesses and drivers from the threat of fraud and ensuring smoother operations on the road.

So let's continue to stay vigilant and stay ahead of the game in this ongoing battle against skimmers. After all, as the saying goes, teamwork makes the dream work!

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