Is your credit card safe at cruising altitude? By Christopher Elliott | December 2, 2012 Maybe it was the Bloody Mary that got Jean Shanley into trouble on a recent flight from Louisville to Las Vegas. She paid for the $5 beverage with her American Express card and then slipped the card back into her pocketbook, where it stayed for the rest of her vacation. When she returned home, Shanley, a sales associate for a department store in Burlington, Ky., found $1,300 in fraudulent charges on the card — and she suspects that Southwest Airlines is responsible for the security breach. Travelers are easy prey for “carders,” who take illegal credit card impressions in a crime called cloning or skimming. Airline passengers such as Shanley may feel extra vulnerable, because on a plane, plastic is often the only payment option for beverages, meals or duty-free items. (Airlines euphemistically call it a “cashless environment.”) Apart from the timing of the charges, several other clues point to Southwest as the responsible party. First, Shanley says, the flight attendant took 15 minutes to return her card; and second, she’d never had a fraudulent credit card charge until she made the in-flight purchase. “I think it’s strange that the charges showed up two days after that flight, and I have never had a problem before,” she says. Southwest says it isn’t responsible. “Cardholders tend to focus on the last known legitimate charge as being the point of compromise,” airline spokeswoman Linda Rutherford says. “However, our security folks advise us that it could be any number of merchants where the card was used prior to the Southwest flight.” She says Southwest has “no reason” to suspect the crew on Shanley’s flight but agreed to forward her complaint to management “for their review.” Shanley’s credit card company reversed the bogus charges. But Shanley’s problem raises two bigger questions for air travelers who want to buy something on board: Is it safe? And is there a way to protect your card? Here’s the bottom line: Fraud can take place anywhere, even at cruising altitude, and no protection measures are airtight. Could a flight attendant moonlight as a carder? You bet, says John Sileo, an expert in digital privacy. The gadgets used to perpetrate these crimes are small enough to be concealed in a pocket. “There are skimming devices that are only slightly larger than a matchbox,” he says. “I’ve seen waiters hold the check folio in such a way that they hide a skimmer and are able to skim the credit card while standing at the table.” An accomplished carder can clone a credit card right in front of you without your knowing it, he adds. “They make it look like they’re sliding the card into the check folio,” he says, “but they’re actually swiping the card.” The credit card security experts I spoke with say that Southwest isn’t necessarily to blame, because a card can be skimmed anywhere, and the bad charges don’t always appear immediately after the theft. Any time you hand over your credit card, you’re exposed, because you’re giving a potentially dishonest clerk an opportunity to make an illicit copy of your card information from the magnetic strip. “Once the thief has the credit or debit card data, he or she can place orders over the phone or online,” says data-security expert Robert Siciliano. But thieves can also copy that data onto blank cards, which are called “white” cards. The plastic can even be dressed up to look like a legitimate card, he said. Such data theft creates a massive money drain. The most frequently cited statistic is a 2010 U.S. Secret Service estimate that skimming is an $8-billion-a-year problem. (It includes ATM skimming, which, as the name implies, happens when you use your credit or debit card at an automatic teller machine.) I know that it’s a problem, because my own card has been cloned, and I’m not entirely sure how it happened. The last place I’d used the card before the fraudulent charges popped up was in a sandwich shop in British Columbia. But that means nothing. Carders can wait weeks before running fraudulent charges, and I’d like to think that the deli was as honest as the tuna sandwich they made to order. How do you avoid being skimmed? Identity-theft expert Rob Douglas says that using cash whenever possible is the only way to be safe. He recommends forking over greenbacks for minor purchases typically associated with this kind of fraud. “That includes cab rides, coffee and newspaper kiosks, meals in restaurants located in high-tourism locales, airport vendors and similar operations where a carder can obtain a large amount of card data with little risk of any single stolen transaction being tracked,” he says. Experts say that the only long-term fix is to tighten security on credit cards by requiring PINs and using security chips that are far more difficult to copy. But American credit card companies have been slow to embrace such changes, citing higher costs and downplaying the security risks. The next time they do that, maybe they should talk to Shanley or Southwest Airlines — or me. Do you feel safe using your credit card on a plane? Yes. No. View Results Loading ... Christopher ElliottChristopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at firstname.lastname@example.org. Got a question or comment? You can post it on the new forum.More Posts - Website - Twitter - Facebook - LinkedIn - Google PlusFacebookTwitterLinkedInGooglePinterestReddit Related http://flyicarusfly.com/ Fly, Icarus, Fly Like you said, this can happen anywhere. If the limit for which you’re responsible is $50, then personally, I probably wouldn’t take any countermeasures (like having loads of cash on me). That said, I’d probably change my tune if my card did get cloned and I had to wade through the hassle of setting it straight… bodega3 Is card safe being used on a plane? Just as safe as any place else. What all travelers should have are at least 2 cards, if not 3 with them so if they check their accounts while traveling and have to cancel one, there is still one left. I called my credit card company about a charge on my bill that wasn’t mine and while I was speaking to them, my card was being used at a major department store, but I wasn’t the one using it. Credit card thieves have ways most honest people don’t even thing of or know about in obtaining your card information. Leslie My Best Buy card got cloned — it happens – and the fraudulent charges were reversed. It happens – its inconvenient and annoying but that’s the way it is sirwired It’d be pretty tough to be a “carder” on-board an aircraft. The space is just too cramped, making it way too easy to get caught. In addition, any carder that uses the skimmed number so quickly is going to get caught, FAST. All it takes is a few people that pay for their drinks with they same card they use to book the flight; the full ticket information is part of your credit card bill; the bank knows what day you were supposed to fly. Frankly, Credit Card Fraud is such a low-impact crime for consumers, I have a hard time getting worked up about it. You call your bank, they reverse the charges, issue you a new card, end of story. Maybe the merchants get burned, maybe their bank, or your bank, takes it in the shorts instead… As a vaguely-related side-note: If this had been a non-PIN-Debit, this story could have been much worse for the OP. Friends Don’t Let Friends with Access to Credit Carry non-PIN-Debit. http://elliott.org Christopher Elliott Well, that’s the thing — many airlines have card-only policies for paying for items on board, so we have not choice but to use a card. TonyA_says Can you use a pin only debit card onboard a southwest flight to buy food or drinks? lost_in_travel I agree the most important thing is to carry more than one card so if a problem arises, one can still function. And don’t forget to tell your cards when you travel – especially out of the country. I joke that I often don’t tell my mother as much about my travels as I have to tell my credit card companies, but my mother does not monitor my activities as closely either! I try to use one card for all the charges on one trip so my book keeping is easier, but the back up card is always ready. And don’t forget about the “holds” that various hotels and gas stations put on. The gas station on the highway put a $100 hold as well as the $54 charge for the gas that went into my tank on my card. And the two hotels each with about $50 beyond the room charges. Fortunately at this time in my life, it is no big deal on my credit limit, but there was a time that this would have been very important to me. Cybrsk8r How about a re-loadable card for use on planes? You stop at a kiosk in the airport, stick-in two $20 bills, insert the card and presto, you now have a limited liability card for use on the plane. Similar to those use-once throw away American Express numbers for use online. Scammers would not bother trying to skim these cards since the small amount they’d get wouldn’t get enough to make it worth their time. technomage1 I’ve had my credit card number stolen and used twice. Both times it was embarrassing (having your card declined at the register is not fun). But a quick phone call and confirmation of the purchases I did and did not make solved the problem. It was a pain waiting for a new card to arrive in the mail too. Still, though, I’ve never been on the hook for any fraudulent charges and I’d rather the credit card companies deactivate my card when they see questionable purchases. As others have pointed out, it happens everywhere. Unfortunately, it’s the price we pay for having the cards. I will note though, credit cards and debit cards can differ in their protection for consumers. I refuse to use debit cards because if they do get that number, they can wipe out your bank account and you have less protection with a credit card, in addition to any pain you may feel from checks bouncing, etc. Instead, I use my credit card and have set it up so it deducts from my account automatically every month. Essentially, I’m using it as a debit card but I still have all the protections of the credit card plus bonuses like cash back. technomage1 I disagree that credit card fraud is a low impact crime for consumers. Merchants actually pay the credit card companies a fee to be able to offer their services. Now, this varies but is typically a percentage of the total sale. It ranges from .5 to 2 percent for most merchants. This rate covers the credit card companies expenses and profits. The credit card company usually is the one to “eat” the fraudulent charges. So they pass that along to the merchant in terms of higher fees, who passes it along to consumers in terms of higher prices. Yep, we all pay a higher price in the store for the ability to use credit cards and for fraud on those cards. It would be better to say that credit card fraud is not as visible to consumers, but it sure has an impact on us. TonyA_says If you read the reason why airlines moved to card only on board, it is because Cash was disappearing between the FA -Station – and HQ. In other words there were dishonest FAs for the same reason there are dishonest cops and stockbrockers. Having said that, then why should anyone be surprised that an airline employee can be a thief? EdB “It’d be pretty tough to be a “carder” on-board an aircraft.” Not true. In the case of this story, it sounds like the attendant took the card away to be processes (First, Shanley says, the flight attendant took 15 minutes to return her card). If they go somewhere else to process the card, you put yourself at greater risk of carders. I also remember a story some time ago about a pair of carders working together on a plane. The attendant got the card information and then sent their partner the info while they were still in the air. TonyA_says It also harder to save money when one has a credit card or credit for that matter. People tend to buy more when they can charge it. That has profound socio-economic effects. Just ask young grads with massive school loans and credit card debts. Promoting the use of credit is the wrong message to send to anyone. EdB A $100 hold at a gas station? I have never seen that happen. I see a $1 “hold” that is used to validate the card is good. If it is a terminal at a pump, the station, from what I have been told, has no control over the processing and couldn’t change it. If you take it in, that is a different story. In that case, I would report the station to the card issuer and if it is a brand name station, report it to the company headquarters and never shop at any of those stations again. EdB In regards to that $50 liability limits, a lot of card issuers even waive that fee. All the cards I have had over the past several years waived the fee. When shopping for a new card, that is one item that should be on the check list. If not, keep looking. NakinaAce How could you possibly write this whole piece without mentioning even once that the card holder is only ever responsible for the first $50 and nothing after that and after you report a problem you are responsible for nothing. That is a matter of law. All this jazz the CC companies give you about protecting is really only about protecting themselves. That is fair enough except when they routinely deny charges based on some far fetch model that doesn’t include someone like yourself. TonyA_says I understand that some airline onboard credit card terminals or scanners do not have online communication capabilities so they do not have the capability of checking a bogus card or authorizing a sale. That said, what is to stop the public from using bogus cards or disputing their purchases alltogether? email@example.com It is just as safe as being used anywhere else. I have had a card comprimised in the past and also had a fraudelant check hit my bank account. One has to go through the process of changing the account number. Witha all the automatic withdrawels and social security deposits that can be a pain to change. I have a card that automatic charges are posted to, but that card never leaves my house. technomage1 True, you need to be able to have some fiscal discipline with my method. Guess that excludes Congress from using it, huh? TonyA_says The longer your card is out of your sight, the more unsafe it becomes. Of course, this assumes you are not putting the card through a skimming device yourself. TonyA_says The government is the worst example since they can print money and spend it. Timothy Woody OK. It’s too expensive to provide more secure credit cards??! Preposterous! If you have a card that with annual charges It is certainly within the realm of reason to expect that the annual fee would be used to provide a more secure card. After all, once the security system is in place the cost of maintenance is significantly lower than the establishment of the system. Card fees, however stay the same or creep up. It is absurd to think that it is “too expensive” to establish a more secure credit environment. The cost of fraud and identity theft overshadows the cost of the security system. $16635417 I understand the risks of using a debit or credit card vs. carrying cash. I prefer using a credit card when traveling. I have yet to encounter a situation on-board where I was forced to pay for something mandatory. I can skip the Bloody Mary. I can pay cash for a sandwich at Subway and bring it on-board. I can even bring my own entertainment and headphones. In other words, I can easily boycott. I can also adapt If I choose not to carry a credit or debit card. I could keep a MC/VISA/AMEX or Discover gift card in my wallet for situations like this. As someone else mentioned having a gift card dispenser at the airport for buy on board sounds like a good idea. TonyA_says Chip and Pin? And handheld terminals. Like in Europe. EdB “Too Expensive” to the card companies means the cost of fraud has not exceeded the amount they have allocated to losses from fraud. Once the cost to the bottom line from fraud loss exceeds this amount, then it won’t be too expensive. Until then, the money lost in fraud is built into the merchant fees and card holder interest rate and fees. SoBeSparky One does not want to use a debit card anywhere you suspect fraud is prevalent, as money is transmitted immediately from your account. Someone observing the PIN and skimming the card can easily take a lot of cash from your account. That is cash you no longer have for your trip. at least temporarily. Fraud with a credit card means you owe more money, up to a maximum of $50 usually. Fraud with a debit card means the cash is gone. The terms of getting money back with debit card fraud are different. According to federal law and regulations: “For example, if you report the (debit card) loss within two business days after you realize your card is missing, you will not be responsible for more than $50 for unauthorized use. However, if you don’t report the loss within two business days after you discover the loss, you could lose up to $500 because of an unauthorized transfer. You also risk unlimited loss if you fail to report an unauthorized transfer within 60 days after your bank statement containing unauthorized use is mailed to you. That means you could lose all the money in your bank account and the unused portion of your line of credit established for overdrafts.” Your bank may or may not offer more protection than federal law. The point is that using a credit card is almost always a safer proposition than a debit card. So on line, or in public, you usually get more fraud protection through a credit card. In certain circumstances your cash can be drained by a debit card without recourse. lost_in_travel Yup, Gulf station on the Mass Turnpike at the pump. My car can’t hold that much fuel, but a pick up truck can. I should have filled my tank before I left home, but I did not. Next time I will. EdB “How do you avoid being skimmed? Identity-theft expert Rob Douglas says that using cash whenever possible is the only way to be safe.” Carrying cash may be the best way to avoid being skimmed, but the risks in carrying cash I think far out weighs the risks. When you carry cash, if you lose your cash or, heaven forbids, you get robbed, your cash is gone. Bye-bye. Never expect to see it again. However, if you lose your card or it is stolen, Most you can lose is $50 and as I have mentioned before, that is often waived. Personally, I will continue to carry plastic over paper in my day to day activities. When I travel, I do carry some cash, but not a lot and never in my wallet. EdB It’s not the cost of the new secured cards and terminals, but the underlying infrastructure that has to be in placed to support it. Secured cards have been around for years and really are not that expensive. It’s a reliable system to handle the security that is the issue. EdB Did some googling on it and sure enough, found several references to stations doing this this. That is just outrageous. Like I said, I would report them to the credit card company, the card issuer, and in this case, the corporate headquarters and never get gas at a Gulf station again. I haven’t seen a Gulf station in years and didn’t realize they were still around. If I ever see one again, I’ll be sure to keep on going. Looks like Pilot/Flying J is also into this… http://www.connectamarillo.com/news/story.aspx?id=591352#.ULtrXYPLRWI They are another one I will avoid from now on. Luc Terje This is exactly why one should NEVER use a debit card to buy anything. Her bank account would have been drained while she was on vacation, and she’d have to duke it out with her bank to eventually get her money back (2-3 weeks). With a credit card, she’s not out any money, and just calls the card company to fill out a report to get the charges removed. TonyA_says My question is can you use it? How will a user input his Pin on a southwest terminal EdB Not seeing the terminal used it would be hard to tell. It most likely has a keyboard, how else could they tell the terminal how much to charge. So if it has a keyboard, the PIN could be entered by the user by handing the device to them to enter the number. What would probably determine if it could be used for PIN purchases is the type of data connection they have during flight. If they have a live connection, then it *could* be set up for PIN use. TonyA_says Are you serious? You mean the telecommunication networks used by Visa, Master and others are not secure? I thought the card information is stolen at the point of sale or from a Merchant database if they store the info. LJBROCK So, the airlines removed cash because they don’t trust their employees, but we’re supposed to hand our credit cards over to them to pay for things?? Yikes. Stephen0118 I believe some credit card companies offer you the option of using a ‘variable’ cc number where it’s only good for that transaction. I know of one mine does that (I can’t remember which one. Carrie Charney In every one of the several times that my credit card has been charged without my knowledge, it is the credit card company that has notified be by phone and email within minutes of that charge. I am constantly amazed at the vigilance of the computer programming that picks up these fraudulent charges. EdB That is not the infrastructure I was referring to. Hopefully the telecommunication network used are secure. It’s the infrastructure inside the card company’s IT department the secured external network talk to. You have to have a system that can process the secure ID information being sent to determine if it is valid. That is where a lot of the expense can occur. You also bring up another point a lot of people don’t realize. A lot of merchants processing systems record your CC number. I have had several instances (Best Buy and Walmart being two large companies I have had this happen with) where I was returning a product. They scanned the receipt and put the credit back on my card without me even showing them the card. How can they do that without storing the number? A lot of the large data breaches have been because someone hacked into a merchant’s system where the numbers were stored unencrypted (.i.e. TJ Max). Merchants are allowed to save your CC number as long as it is secured, which requires encryption. When such a breach occurs, the card companies can go back to the merchant to recover the money because they violated the merchant agreement. EdB Yes, but that is only for online transactions. Kind of hard to present a card with a variable number unless you have an embossing machine with you. :) TonyA_says Everyone should read this http://www.flightglobal.com/blogs/runway-girl/2011/07/free-beer-in-flight-but-only-i.html EdB Looks like that story answers your question about PIN purchases inflight. Without real time validation, it can’t be done. They are not allowed to record your PIN like they can with the number. Catherine You can set up alert systems with your credit card to get an email every time your credit card is charged. If you do have trouble with it..you will know it right away. Also traveling with more than one card is important so that you have a backup on a trip. EdB Those alerts are dependent on the issuer. Not all of them have that feature. I do on my cards and I use it. However, the alerts can be delayed. I had one alert come 2 hours after the purchase was made. Most of the time, I get the email while I am still at the register or before I have left the store. Even with the delay, that is plenty of time to notify the issuer of a problem. TonyA_says As far as I know CC companies have low limit caps for onboard charges for this reason. Qatar airlines, as far as I know, worked on a solution with their handheld terminal vendor so they could charge high value duty free items onboard. Unless airlines are willing to pay ARINC for using their credit card transmission application then the airlines need to figure out how to get online authorization up in the sky. http://www.arinc.com/products/revenue_protection/live-cca.html $16635417 It’s not only because of missing cash, it’s also more efficient to not handle cash. Makes the turn more efficient once they land. Skimming is a problem in any establishment that handles cash. EdB That’s really not that hard. Satellite network connection are available. They have automated tracking systems for the satellite dish to keep the connection. The issue is the costs to the airlines. Is it worth it? Seems most of them are saying no at this time. cjr001 “First, Shanley says, the flight attendant took 15 minutes to return her card” Well, this would certainly be the center of my argument, were I in Shanley’s position. Why did the flight attendant walk away with the card at all? Does Southwest not use handheld card readers like United and Frontier (the only two airlines I’ve flown in recent years)? Such readers at least keep your card in sight and no more than a few feet away. Yes, there are skimmers, as the article points out, but with your card in sight, it at least prevents some opportunities… like it disappearing for 15 minutes. EdB That’s true Mike. I remember several flights where I had a seat in the back and the attendants would have to spend a good portion of their time counting and recording not only their till, but verify the amounts of the other attendants. That required at least two attendants to be away from their primary job of safety. It also required the aircraft to be equipped with a secured drop box or safe to store the money in. http://upgrd.com/roadmoretraveled MeanMeosh “How do you avoid being skimmed? Identity-theft expert Rob Douglas says that using cash whenever possible is the only way to be safe.” Suggesting that you keep a big wad of cash on your person on vacation is quite possibly the worst advice you could provide. I won’t even go in to the personal safety risks with carrying a bunch of cash in an unfamiliar or tourist area. When that pickpocket on the metro reaches in to your jeans and lifts your money clip, you’re hosed. Good luck if you’re early in your vacation. While a pain, a credit card can be replaced. TonyA_says So they passed the problem to us, the passengers :-) cjr001 Also, when you get down to it, credit card companies really are partly to blame. As the article notes, they have been pathetically slow in adopting the pin system used in Europe. How can it possibly cost more to switch to that system than they’re paying now for credit card fraud? EdB Like that is anything new for the airlines. Passengers have always gotten the shaft from the airlines. *grin* TonyA_says You still may need to buy bottled water :-) EdB The CC companies could save a lot of money if they switched. But the problem is, they have already built in an amount of loss to fraud in the business model they use. As long as the fraud loss is below that limit, they are not going to change, even if it does save them money. Why? Because change involves risks and the costs of those risks are perceived to be greater than the savings. EdB It’s been awhile since I have flown, but are the airlines no longer providing cups of water anymore? TonyA_says That is the point of the article. The passenger or the OP got quite inconvenienced by the dishonest airline employee. How about throwing a bone, a certificate? TonyA_says Too high a bacteria count! I will buy bottled water instead. For domestic flights, you can take the one you buy in the terminal. For international flights to the USA, extra security before you board will confiscate water bottles bought inside the terminal. But usually drinks are free for intl anyway. EdB I agree with the airline in this case. How do we know it was a dishonest airline employee? Now if she can prove it was an airline employee, then yes, I think the airline does owe her some sort of compensation. Otherwise, the airline is just one of several possible sources of the breach. Should every merchant she used the card with offer her compensation? TonyA_says So now they use card SKIMMERS since no more cash :-) phenomenallass I’m flying later this month and had planned to purchase a Visa gift card for small purchases – like this – while traveling. Can be used anywhere a traditional card can be used. Airports are hotbeds for this kind of activity. Why put myself at anymore risk? TonyA_says Did the airline bother to investigate the employees that handled the card? I have had my card skimmed a number of times, mostly in restaurants. Each time I do report it as a crime with my local police force and each time I bother to call the establishments where I suspect it was done. Most times, I talk to the manager. I was most impressed by the way Friendly’s handled my problem. The regional manager dug up my charge receipt and identified the waitress that scanned my card. He made an investigation and I was satisfied it wasn’t her. The manager sent me a personal note together with a free meal certificate for the whole family. I had another charge right before that ice cream visit. I took the kids to TGIF in the mall. The TGIF manager told me the store was too busy to track their employees. Hmm, a bad sign. Anyway my point is we never returned to that TGIF but we still go back to Friendly’s. I never used my Friendly’s certificate because I did not feel it was right for me to do so. So how about some good PR by sending the OP a small certificate and a sorry note. EdB Given that the airlines probably don’t have a live connection, I’m not sure a gift card would work or not. Do you know anyone who have used one on a flight to be sure? The type of card being used is encoded into the CC number and they could be set up to exclude the gift cards. Might want to make sure about this before leaving. Bill___A No one should ever disappear for 15 minutes with a credit or debit card. Flight crews need to be educated. As for the chip and pin thing, I think pretty much everywhere else has it. Going to the USA is like going to a third world country as far as credit cards are concerned. I was in the Samsung Store at the Westfield Mall in London. They actually turned away a man who only had a stripe! I’m sure that is against their card agreement, but the bottom line is that they did it. They said people without chip and pin usually end up paying cash. Bill___A Where I live, the pay at the pump device asks you how much fuel…maximum $100 and that’s put on the card as hold. It happens. Apparently, some people have in the past driven off without paying for their fuel, which is probably why they do that. Ed, you’re not going to change the world. There are some things you can do something about and some things you cannot. You will just make things difficult for yourself if you go off complaining about something like this. It has been pretty widespread up here for years….and no one complains about it. judy nagy Always put your credit cards in the same place and make sure they’re all there every few days when travelling. Carry an extra card, keep any cards you don’t need that day in a separate place. Check your accounts online the minute you get home from a secure computer. Sign up for alerts for charges in excess of a certain amount. Any doubts, cancel the card immediately and use the extra card. Rebecca O’Shaughnessy The gas station sites have control over the processing. They contract with a merchant bank who puts the holds. Also, don’t let them tell you there’s a limit on the amount you can pump imposed by credit cards. They implement the limits at chargeback limits. And if there’s ever an unnecessary hold you need removed, call and ask for a supervisor in the fraud dept. They can reverse the hold. If they tell you they can’t, they’re not a supervisor. Ask for theirs. EdB Gee. That’s a good reason to avoid a business. How dare they not perform a function they are neither setup for or required to perform. I know you run a business and take credit cards. How exactly would you investigate a claim one of your employees (if you have any) was responsible? What type of investigation could that regional manager at Friendly’s really of performed? Unless they have access to the transaction from the business where the fraudulent activity took place, they really can’t do anything in the way of an investigation. The fraud took place against the credit card company. Not you. Not the business. Both you and the business have methods for relief and are not responsible for the fraud as long as you have followed the rules. The only entity that can really request an investigation is the credit card company. EdB put your credit cards in the same place and carry and extra card? Are you saying to carry the extra card with all your other ones? And is this extra card on the same account as one of the other cards you have? $16635417 I usually buy a bottle post security anyway. I think water is usually free anyway, poured from a bottle into a cup. I can’t recall paying for soft drinks. $16635417 I remember an East Coast to LAX transcontinental non-stop where I paid $5 for the movie. Gave the FA a $20 bill and didn’t get my change until her last pass before landing at LAX. I kept reminding her about my $15 change throughout the flight with the “I’m working on it!” response each time. I kept having to remind myself to not forget my $15. I would have GLADLY had her swipe my card so I could relax! $16635417 How do we know it was the FA? TonyA_says We both IDed the server. And he convinced me her record in the store was pretty good. In fact, she served me ice cream again and again until they shut the store down. TonyA_says Who else had 15 minutes with her card? EdB So you ID the server and she has a great record in the store. That proves nothing as to her guilt or innocent. I’m pretty sure if she was the one who did it she wouldn’t have done it inside the store. How did he know what she was doing outside the store where the fraud would have taken place? That is my whole point. A store has no way to really investigate the criminal activities of any of their employees unless the activity happens in the business. And expecting a business to do an investigation is absurd. I noticed that you didn’t bother responding to the part about how you would investigate one of your employees if your business was accused. EdB What does it matter? It only takes a second to use a skimmer. The question would be more, “Who else had access to her card?” TonyA_says No Ed, what is absurd is your questioning the judgement of the cardholder and the action of the store management. EdB I am not questioning their judgement, just their ability to perform an meaningful investigation. In the case of the Friendly’s manager, I’m sure his judgement of her inside his business is valid. It’s just they don’t have any valid bases to make a judgement of the employee’s action outside the business. It is absurd to expect any business to perform a criminal investigation when they are not equipped, authorized, or required to do so. TonyA_says Southwest does use a hand held terminal so it is unexcuseable for your card to disappear beyond your sight. I believe they use http://www.guestlogix.com/ $16635417 There’s something bugging me about this that doesn’t seem to add up. How often would someone do this? Is it worth it to just do it once? It seems like the credit card company would see a pattern that Southwest on board purchases appeared on a significant amount of cards that ended up having fraudulent activity. The airline could determine what flights people with fraudulent charges took and compare the FA list of those flights and see common names. If someone only did it once, I imagine it would be easier to get away with it. But is the investment in the “skimmer” and time to learn how to do the act once worth it? $16635417 I haven’t seen the other charges on her statement. TonyA_says Respectfully, I think you and others are missing the point. Simply stated, by not accepting Cash, the airlines have opened us (and themselves) to more fraud. $16635417 I think that my question actually makes that point. Very easy to determine if there is a pattern with an FA being a “skimmer”. TonyA_says Is half a million bucks enough to convince you? http://sanfrancisco.cbslocal.com/2011/02/16/airline-employee-accused-in-500k-san-jose-credit-theft-operation/ This book claims 1.1 mil from southwest http://books.google.com/books?id=_uwYG7S0d8UC&pg=PA28&lpg=PA28&dq=airline+employee+skimming&source=bl&ots=d4lplJH6pf&sig=W6Wk6oFrO1wkP2vQaUKOPA7x7xw&hl=en&sa=X&ei=sKC7UJacD-Xo0gHih4DABA&ved=0CFkQ6AEwBzgK But Mike, why is Southwest punishing those who want to pay with cash? $16635417 Convinced of what? EdB Respectfully, I think you are missing the point. The fraud is not against the consumer or the business, but the credit card company. If the credit card company does not feel it is worth going after, there is really nothing you as a consumer or business user can do other than not to use the card. phenomenallass These cards don’t function any differently than a secured credit card. They have a real credit card number, cvw2 number and expiration date. Worst that happens is I have to fly without a beverage – no big loss. EdB From the user’s perspective, they do not function any differently. However, from a processing stand point, they do. The issuer of the gift cards can put restrictions on what they can be used for or how they can be used. For example, some cards cannot be used for online purchases, even though they have a number and the security code. That requires that before the card can be processed, the merchant’s system must be able to validate the proper use of the card. Now a merchant can setup an agreement to go ahead and process them regardless. But in those agreements, the merchant also has to accept the responsibility for the fraudulent or improper use of gift cards. Most online merchant agreements have this restriction that since they did not swipe the physical card, they will have to cover certain losses. TonyA_says Are either of you an FA? If counting cash causes a safety issue, I bet it would already be subject to a grievance issue since SWA has a union. I believe APFA questioned an airline for it but that was not WN. jm71 This sounds like a great reason *to* use credit cards wherever possible, as opposed to cash, checks, or debit cards. Cash can be stolen, change can be “forgotten” or miscalculated (“sir, you gave me a $10, not a $20” — and in the cash days, it was common for them to take your larger bill and come back much later with the change), can be pickpocketed or taken from your carryon while you’re in the restroom. And when it happens, you have very little recourse, especially at the moment. With a credit card, you simply aren’t responsible for the fraudulent charges. Sure, there’s some hassle in documenting/detecting/handling it, but less than trying to recover hundreds of dollars in cash. It is definitely a good idea to have an extra card (preferably with a different bank) as a backup. TonyA_says How about EXACT CHANGE? Why is that not an option. Look at SWA’s inflight menu. Liquor, Beer and Wine are all five bucks each. It is so easy for folks to prepare to have correct bills. So why did Southwest rob them of the capabality to pay with exact change? EdB “Are either of you a FA?” What does that have to do with any part of this discussion? dourdan I usually fly Virgin and on Virgin there are card readers on every seat. You scan your card yourself then the flight attendant gets your order (somehow) and your items magically appear. I think that is perfectly safe. but any airline where i would have to hand over my card and the flight attendant disappears with it- not so safe. Ann Lamoy Agreed. I got a phone call one day from Discover about two years ago inquiring about some large charges on my card. One was for $700 for shoes for an on-line store. I disputed it (since I hadn’t made it) and the rep on the phone went through the last two weeks of charges to see what were mine and what were not. She said it was flagged as a purchase outside my norm. There were four charges totally almost $1000 they ended up reversing. After that, I went and set up alerts on all my credit cards and am vigilant at checking them every couple of days for charges just in case. TonyA_says Here is what he said (without editing) completely: Identity-theft expert Rob Douglas says that using cash whenever possible is the only way to be safe. He recommends forking over greenbacks for minor purchases typically associated with this kind of fraud. You purposely left out his next sentence (in Chris’ article). Rob Douglas makes a good point using cash for MINOR purchases. http://twitter.com/PlayYourDay Play Your Day I would just never use CC on a plane. Why not to use old – fashioned money? They should accept it do they? I’m not sure about US anyways but Im more than sure in Europe.. bodega3 According to our sources within the industry, the carriers were not getting all the money that passengers were giving to FA’s. Some carriers are paying the FA’s a commission on items sold which burns my hide since they don’t pay us anymore for selling their tickets! bodega3 According to what we have been told, FA’s were not reporting all the money earned on cash sales. TonyA_says Well that is the problem the airline was trying to solve (employee theft of airline money). By moving to cashless cabins, the airline had eliminated employee theft of company money, but the bad employees moved to skimming cards instead. There always will be bad apples. Card skimming is not a victim less crime even if your credit card company waives your $50 liability. At a minimum, the pax is hassled while on the road and when he gets home. Freedom from Cash benefits to pax is bogus. It penalizes people who want to or need to pay with cash (i.e. UMNR kids who need to buy a meal). Why can’t an airline accept both plastic and cash? Because these airlines only care about their own efficiencies. Too much work for flight attendants? How did we manage to do that work for decades? Did we all suddenly become lazy? Nope, I suppose the airlines did not want to keep on disciplining employees that stole money because that became a thorny union issue ??? So, too bad for passengers who want to pay with cash, both the airline and their employees could care less. In the future, the airlines will depend on plastic more to sell ancillary services onboard. All of the new for-fee advanced inflight entertainment and communications (IFEC) services need plastic payments. So the message is clear. Use your cash elsewhere except the airlines. TonyA_says Wait till they make us pay the Merchant Fees. Didn’t UA try that some time ago? Of course you know they do not accept CC for Bulk Fare to Europe – so that is inconsistent with Plastic only in the cabin. The difference is the TA carries the risks. TonyA_says You see that is the whole problem. Some people and airlines REFUSE TO ACCOMMODATE YOUR NEED TO PAY WITH CASH or some form that you feel safe with. Some people even refuse to understand why you may want to pay with cash. Imagine an Unaccompanied Minor needing to purchase a cabin meal? How to do that. buy them a gift card??? I don’t charge small items to my card, especially when I am traveling. I feel more secure doing that. So just like you I will skip that beverage :-) TonyA_says One more Bodega, I understand that the fallback procedure if the handheld terminals don’t work is to use CASH. So they can accept CASH, they just do not want to. William_Leeper As a merchant, I have the option to set up my terminal so any charge of less than $25 does not require a signature nor a PIN number, at the same time, my guys I the field are also prohibited from processing an identical transaction within 10 minutes of each other. Ie there would have to be a 10 minute wait between those bloody marys! William_Leeper It is against the merchant agreement with both visa and MasterCard to charge the merchant fees to the customer. They can add the fees into the price of the product, but cannot add surcharges for using a card. TonyA_says Maybe Not anymore??? http://www.nytimes.com/2012/08/09/business/smallbusiness/visa-and-mastercard-settle-lawsuit-but-merchants-arent-happy.html?pagewanted=all Wanna pay your New York tax by credit card? The State website even tells you that a convenience fee will be added to the tax you will pay http://www.tax.ny.gov/pay/all/pay_by_credit_card.htm Good Luck disputing that. TonyA_says Walhon, I also have to explain the nature of airline ticket credit card sales by travel agents. Most of our CC sales are pass through were the airline itself becomes the CC merchant (via a payment settlement processor called ARC). So the airline actually pays the merchant fees to the CC company (and not us). When the airline refuses to do this (no longer wants to become the merchant) the TA must process the CC through its own Merchant account. So the TA now eats the approx 4% merchant fee (high because it is usually card not present). So the TA must pass that added cost to the buyer in some form. If the TA does not make any commission from UA, then it has no choice but to pass it on. EdB Doesn’t apply in California. California Civil Code 1748.1 specifically prohibits merchants from doing that. Other states may also have such exclusions. TonyA_says Same here in Connecticut. I think there are 10 States that explicit forbid this anyway. It is also supposed to be illegal in NY but I just showed a link where NYS explicitly allows its tax processors to add it :-) So maybe charging a CONVENIENCE FEE is ok. bodega3 How merchants get around this is to state the cost and if you pay cash, there is a lower price. Happens daily in our business and others, too. jpp42 Many (most?) domestic mainline flights now have online capabilities, using the ship-to-ground communication facilities provided for Internet. This was one of the reasons that credit card acceptance for purchases suddenly became common/required around the time in-flight Internet was installed on many airlines. TonyA_says Yes for the inflight entertainment including internet (i.e. Row44, Panasonic, GoGo, etc.), as well as the phone companies, because these companies themselves built the billing mechanisms. Obviously they need to charge the passenger. Now you can’t imagine that the airline will pay these companies just to authorize a $5 vodka (small) bottle. It makes sense only for large items like those luxurious stuff seen on magazines. AUSSIEtraveller why is the US banking system so dodgy & so 3rd world ? We’ve had PIN’s for credit cards for years now in Australia. Oh I forgot, it was the super dodgy US banking system & even dodgier bankers that caused the GFC !!! You really should do something about your banking system & your bankers who are ripping you off blind !!! ExplorationTravMag @TonyA_says:disqus – but isn’t that how it is in today’s world? Selective editing is used in the MSM all the time to create the greatest amount of angst for the reader. No, no, no, no, no, don’t bother with telling the whole story. If we do then people might actually start thinking for themselves. TonyA_says Also there is more than one way to look at a story. The first is to be completely legalistic and technical without regards to customer service or the feelings of the customer. The second is try to understand where the customer is coming from and give them the benefit of the doubt. Of course the airlines (a private company) can dictate how they want to get paid. They do not have to accept US currency if they don’t want to. There is no federal law that obligates them to accept cash. But then common sense dictates to normal people that if you are a US registered carrier (taking advantage of US taxpayer’s money) maybe you ought to be more patriotic and take US currency. MarkKelling The answer is no. WN accepts CREDIT cards only or debit cards with visa/ MasterCard logos that can function as credit cards (i.e. no PIN). MarkKelling Most airlines had a continuous data feed back and forth to their planes. They piggyback the credit card transactions on that link (there is surprisingly little data that has to move to get a transaction authorization). And the actual cost of the inflight internet is very low compared to what they charge the passengers anyway. MarkKelling Yes, the networks used by all the major credit card companies are secure. They are triple DES encrypted at the very least. MarkKelling Have not had my water confiscated on international flights. Just got back from London post Olympics and carried 3 bottles with me I bought in the Heathrow terminal. just over a year ago I flew back from Frankfurt and also carried water visibly in my hand with no issues. TonyA_says Always confiscated from Asia. I will test again soon. bodega3 It isn’t across the board at all international destinations. CUN is where friends had their confiscated. pauletteb Southwest is lying through its teeth, and I doubt this is the only instance of CC fraud involving this particular FA. Chris’s bringing this incident to the public’s attention might well uncover additional claims by other passengers on this FA’s flights. sunshipballoons I’ve never purchased anything on SWA, but I have on other airlines. When I have, the FA is carrying around a card scanner, and they run the card right in front of me. If that’s how it usually works on SWA, it seems very likely that the FA is to blame. Where was he or she for 15 minutes with the card? Why was he or she gone at all??? EdB You have no basis for blaming the FA. We only have the OP’s accusation the the FA took the card for 15 minutes. Did the OP order her drink during the regular drink service or did she order it afterward? If ordered afterwards, it’s very likely the FA wasn’t carrying around the terminal or the drink and had to go to the galley to prep it. During that time, other issues may have come up that needed to be address, like maybe the FA had several drink orders. Bottom line is we don’t have enough information and calling the FA a thief (that is basically what you are doing by putting the blame on them) is out of line. We don’t know where else she used the card before or after the flight. Anyone who has handled her card at any time could be to blame. Emanuel Levy I am not concerned about someone cloning my credit card. The card company is out the money and if they have enough losses then they will push for more secure cards. Nancy Nally Like another commenter pointed out, this is just another reason to love Virgin’s seatback system where you scan your card right in the seat back and place and pay for all your orders for entertainment, food and drink right there. It’s convenient (can order food and drink anytime, not just when the food cart happens to go by) and more secure. http://www.cardauthorizer.com/ Accept credit cards I won’t even go in to the personal safety risks with carrying a bunch of cash in an unfamiliar or tourist area. When that pickpocket on the metro reaches in to your jeans and lifts your money clip, you’re hosed. Good luck if you’re early in your vacation. 19john82 My wife and I went on our Honeymoon to HI in the summer of ’13. On the flight back home, one particular flight attendant walked away with the card which I thought was strange but I assumed she was in the middle of helping someone else. I let go of all suspicions after I got the card back and a friendly “Thank you.” A few days later, our debit card was used in two different states (OH and FL) at precisely the same time (brick and mortar locations). This could only be pulled off by a flight attendant and her (also traveling) coworker, right? Lets see the airlines try to deny that one! Luckily, the charges at Macy’s and Finish Line were caught within minutes because I was online at the time. I contacted the bank and they canceled the card–got my money back within a few days. I’ve never had my accounts compromised in all my years. Lesson learned? I would probably go with a prepaid, disposable debit card on flights from now on (Available at Walmart or Target) or abstain from buying anything at all. EdB “This could only be pulled off by a flight attendant and her (also traveling) coworker, right? ” That depends. Did you ever use your card anywhere else, ever? You ever pay at a restaurant where the waiter took the card? Even if they swipe the card in front of you doesn’t mean they don’t have a reader attached that gets the information. “got my money back within a few days. I’ve never had my accounts compromised in all my years. Lesson learned?” The lesson you should learn is not to use a debt card but a true credit card. Using a disposable debit/credit card is even worse. In all but the true credit card, it is your money that is gone. With a credit card, it is the banks money. In a case of fraud where the bank is going to have to investigate, which case do you think they are going to go after? The one where it’s your money or their money? 19john82 So what you’re saying is, if I purchased something at a store while in HI. You think there’s a chance that store took my info. Then paid the money to take a flight to two different states and simultaneously bought something with my debit card #? Not to mention, they had to conveniently wait until my Honeymoon was over to do it. Use your noggin buddy. Also, putting just enough to pay for in flight food/drinks on a prepaid debit card for a flight to keep from the hassle of potential fraud and having to cancel a card, update all the bills linked to that card and waiting for a new one in the mail seems well worth the investment to me. But hey, if you want to use a “true” credit card, then by all means. To each his own. Next time my wife and I go away, I’m going with the “false” and hassle-free card. I won’t mind if they steal the change that’s left on that. :) EdB I think you are the one that needs to “Use your noggin buddy.” Think about what you are saying. You are saying that “Then paid the money to take a flight to two different states and simultaneously bought something with my debit card #?” yet the flight attendant was able to pull it off; “This could only be pulled off by a flight attendant and her (also traveling) coworker, right?” – Wrong. Why is it that only the flight attendant could use an accomplish but someone else who intercepted the card number couldn’t have called two other people in two other locations to use the card? The number could have been sold to someone else who resold fake cards. There are a number of ways this could be accomplished. You are assuming it was the same person that stole the card number was the same one who used it. This is a false assumption. That fact it was after your Honeymoon was over is just timing. If the person who stole the number knew you were on a honeymoon, it seems more likely they would use it before the end of it. While you are on your honeymoon you probably wouldn’t be checking the account much so a fraudulent charge may not be noticed for sometime. While putting just enough money on a prepaid card does limit your exposure, it is still your money you are out until it is resolved. And like I said before, who’s money is the bank more interested in recovering? Also, I’m not sure if the zero liability offer from the major card companies (MasterCard, Visa, Amex) applies to prepaid. Back of my mind I remember something about they aren’t. And if not, that is $50 you will never see again.