Prepare for More Local Laws to Ensure Safety at ATM Sites
Millstein, Julian S., Levy, Bruce A., American Banker
The technology of customer service, typified by the banking industry's automated teller machines, permits customers to transact business without interacting with another person, and during "nonbusiness" hours.
Technological advances have increased tremendously the range and availability of services.
However, the technology has also created a wealth of security issues that the vendors offering such computerized facilities may be forced to address.
In the banking industry the first line of security that the banks had to provide for ATMs was customer account access, using a magnetic stripe card and an assigned, or customer selected, personal identification number.
A customer has some assurance that a stolen or misplaced card, lacking a PIN, will not gain entry into his accounts.
Many companies are currently working on additional means to secure access, including customer voice recognition and smart cards, which have the added security of a computer chip in the plastic.
Perils of 'Street Banking'
Unfortunately, securing access to customer accounts through the ATM is only part of the battle.
A much more serious risk to bank customers utilizing ATM "street banking" is the risk of robbery after money has been retrieved from the ATM, and the physical and mental injury in connection with such theft.
Indeed, access to cash by bank customers, which occurs sometimes literally on the street (many ATMs are outdoors, offering no shelter or protection for users), and the availability and use of such machines during "off hours" has made ATM customers attractive and frequent targets for crime.
Law Passed in New York
A recent report to the city council of New York found there were 16 such unprotected outdoor ATM sites in the borough of Manhattan.
Local municipalities are increasingly having to confront the security problems that arise from such facilities.
In 1992, seeking to address the perceived safety problem facing ATM customers in New York, the city council passed a law requiring specific security measures at ATM facilities and compliance reporting by the affected banks.
In enacting the ATM Law, the city council cited 743 reported robberies and attempted robberies associated with ATMs in the city between January 1990 and December 1991, and stressed that the actual number of such crimes was believed to be much higher.
Moreover, the council noted that many of these reported crimes were of an extremely violent nature, including shootings and at least one murder.
A Million Times a Day
Some of the statistics reviewed by the city council were provided in a 1992 report by the banking industry, which found that New Yorkers use ATMs nearly one million times each day, and in 1991 there were 8.1 million active ATM cards in the city, or almost one million in excess of the city's entire population.
Further, the report noted that there are about 2,418 ATMs in 1,038 locations throughout New York City.
The city council further noted that there was no uniform set of standards for security at ATM facilities and found that security measures used at the majority of ATM locations were inadequate to protect the public. …