Digital Skimming: The Emerging Threat of Online Theft and How to Safeguard Yourself

October 7th, 2024 - Written By CyberLabs

In an era when many people shop online on a regular basis, the convenience of digital transactions is accompanied by major hazards. Among these is the growing cyber hazard of digital skimming. This type of cyberattack targets naive customers by obtaining crucial payment information during online transactions. Understanding digital skimming, its prevalence, and defensive measures is critical for both consumers and organizations to avoid this criminal practice.

What is Digital Skimming?

Digital skimming, commonly referred to as online skimming or Magecart attacks, is a method where cybercriminals inject harmful code into e-commerce websites to collect payment card details. Unlike traditional skimming, which relies on physical devices at ATMs or point-of-sale terminals, digital skimming operates exclusively in the online space. Attackers exploit vulnerabilities in website software, plugins, or third-party services to deploy scripts that capture sensitive information entered by users, including credit card numbers, expiration dates, and CVV codes.

This strategy allows attackers to gain financial information undetected because the theft takes place in real time, sometimes going unreported by both consumers and website operators until major damage has been done.

The Rise of Digital Skimming

The increase in digital skimming occurrences corresponds to the exponential expansion of e-commerce. As more people shop online, fraudsters have taken advantage of the increased volume of transactions, using sophisticated strategies to breach websites.

According to a report by cybersecurity firm RiskIQ, the number of digital skimming incidents increased by 26% in 2020, highlighting the growing prevalence of this cyber threat. Additionally, the average dwell time—the period between the initial compromise and detection—of a skimmer reached 18 days. This extended period of undetected activity allows attackers to steal vast amounts of payment data before the breach is discovered.

Several high-profile breaches have brought digital skimming to the forefront, like the 2018 incident involving British Airways, in which over 380,000 customers’ payment details were stolen. Other significant incidents, like as the Ticketmaster breach, show how even well-known and reputable platforms can be vulnerable to such assaults. The possibility for financial loss and reputational damage makes digital skimming a profitable method for hackers, fueling its growth.

Mechanisms of Digital Skimming

 Digital skimming attacks usually follow a systematic procedure:

1. Exploitation of Vulnerabilities: Cybercriminals find flaws in e-commerce systems, such as outdated software or unsecured third-party plugins.
2. Code Injection: Once access is acquired, attackers inject malicious JavaScript code into the website’s payment page in order to grab sensitive payment information.
3. Data collection: When a customer enters payment information during checkout, the malicious code records it and transfers it to an attacker-controlled remote server.
4. Monetization: Stolen information may be sold on dark web markets or utilized directly in fraudulent activities, resulting in considerable financial losses for both individuals and corporations.

Safeguarding Against Digital Skimming

Mitigating the risks associated with digital skimming requires proactive measures from both online shoppers and website owners.

For Website Owners:

• Adopt Robust Security Practices: Regularly update all software, plugins, and content management systems to address vulnerabilities. Implement web application firewalls (WAF) and continuously monitor for suspicious activities.
• Educate Employees on Security Threats:Provide training to staff about the risks associated with digital skimming and how to recognize and report potential signs of compromise.
• Utilize Reputable Payment Processors:Opt for third-party payment processors that adhere to stringent security protocols and offer additional layers of protection against cyber threats.

For Online Shoppers:

Check Website Security: Always verify the URL of the site you are visiting, ensuring it begins with “https://,” which indicates a secure connection.

• Be Wary of Unprofessional Websites: Steer clear of sites that display poor design, grammatical mistakes, or signs of unprofessionalism, as these may suggest compromised platforms.
• Monitor Financial Activity: Regularly review your financial statements and promptly report any suspicious activity to your bank or credit card issuer.
• Activate Two-Factor Authentication: Whenever feasible, enable two-factor authentication for your online accounts to provide an additional layer of security beyond just a username and password.
• Avoid Using Public Wi-Fi for Transactions:Refrain from making purchases while connected to public Wi-Fi networks, which can be easily compromised by cybercriminals.
• Stay Current on Software Updates:Keep your web browser, operating system, and other software up to date with the latest security patches to protect against known vulnerabilities.
• Consider Virtual Payment Solutions:Use virtual credit cards or single-use card numbers for online transactions to reduce the risk of exposing your primary card information.

Conclusion

Digital skimming poses a serious and ever-evolving danger in the world of online commerce. As the e-commerce landscape expands, the tactics used by cybercriminals are likely to become more advanced. It is essential for both online shoppers and website owners to stay alert and take proactive steps to implement security measures that safeguard sensitive data. By emphasizing strong security practices, we can reduce the risks linked to digital skimming and create a more secure online environment for everyone.