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Card Signals Jammed in Latest Retail Theft Scheme

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The FBI is warning retailers about a recent rash of credit card fraud that involves jamming retailer’s satellite signals with – you may want to sit down for this one – simple aluminum foil.

When card systems are down, thieves have been able to purchase cigarettes and high value electronics without paying for them. “If you’re a small business owner, you need to be aware if your credit card system is down and someone is purchasing something, you need to make sure that it’s really down and it’s not something that’s blocking your system,” FBI Supervisory Special Agent Vicki Anderson said on the podcast, “FBI This Week”.

The African criminal ring at the center of these incidents has stolen thousands of dollars in merchandise from convenience stores and other types of retailers in Indiana, Kentucky, Ohio, Pennsylvania, and West Virginia. The stolen merchandise is taken to New York, where it may be sold at pawn shops or exported to Africa, according to the FBI.

Here’s how the thieves pull off this low-tech heist: working in a group, one of the thieves climbs on the roof of a store and uses aluminum foil to block the satellite antenna that the store uses to receive data from credit card companies to authorize sales—a gadget called a feed horn, according to BlombergBusinessweek.

“With the signal blocked, stores can’t validate credit and debit card transactions. That opens the door, so to speak, for bandits to enter the store, load up their carts with electronics or cigarettes, and pay with stolen credit cards,” BloombergBusinessweek reported. “Retailers often permit sales even if the link with the credit card company is down, figuring the transactions will go through once the connection is back up.”

Once retailers remove the blocker on the roof, they realize that it was a scam and “the people have walked out the door with the merchandise and it’s not been paid for,” Anderson said.

“The thieves and their ill-gotten goods are long gone by the time a store realizes its satellite receiver has been wrapped up like a plate of leftover meatloaf,” BloombergBusinessweek reported.

To make matters worse, when the sales are sent to card processors, they are denied because the sales involve stolen cards. As a result, retailers are stuck with the bill in this type of card fraud.

So far, we have heard of only two thieves arrested in the scheme, back in October. The two were stopped with more than $10,000 worth of cigarettes and electronics, and were linked to 600 stolen credit cards, according to the FBI.

While we are glad that the FBI is investigating this nationwide fiasco, we are concerned that things could get worse before they get better. “The crime could become more prevalent because of the low-tech way it’s executed,” Mollie Halpern with the FBI said on the podcast.