At twilight one day last fall, a California legislative aide parked near her Sacramento bank's automated teller machine, which was at the side of the bank, in an alley between the bank and a car dealer's lot. As she keyed in her identification code, "a guy came up the alley and stood between me and the car," she said. "I had an uneasy feeling, but it wasn't clear he was a robber."
The moment she had completed the transaction, however, and withdrawn $40, the man came up behind her, pinned her to the machine, and muttered, "Keep quiet and give me the money." After she did, he ran away down the alley, leaving her, shaken but unhurt, to report the crime to the police, "who probably thought me foolish to go to an ATM alone," she said. In fact, she added, "I never go to that machine any more, and I won't go to any after dark now. I'm nervous by myself even in daylight."
Such holdups are now called ATM-related crimes ("ATM" for automated teller machine), and as ATM crimes go, this wasn't a bad one. People have been robbed, raped, even murdered by criminals waiting at quiet sites for them to withdraw money. They have been forced at gunpoint to go to an ATM; there was even an "ATM rapist," who kidnaped 11 different women from San Fernando Valley parking lots, raped them and then forced them to withdraw funds from ATMs before letting them go. The man accused in that case is awaiting trial in October.
The number of these crimes--from quick holdups to big news stories--is causing increased anger and concern. Victims are now suing their banks for both their injuries and their financial losses, and legislation at both state and federal levels has recently been proposed to force financial institutions to beef up security around their ATMs.
The industry, in response, says it is no big problem. What's more, its members are doing everything they can--lights, cameras, alarms--to make ATM sites safer, while insisting that the responsibility isn't all theirs: The consumer should watch out for himself.
Blame and even liability aside, these ATM crimes ironically represent progress: "There was horse theft, and when there were automobiles, there was auto theft," said Cmdr. William Booth of the Los Angeles Police Department. "Now there are computer crimes, credit card crimes, ATM crimes. Criminals follow technology."
It is no surprise that ATMs should draw a secondary--and criminal--clientele, given the rule propounded by notorious criminal Willie Sutton when asked why he robbed banks: "Because that's where the money is." To a criminal, ATM machines are--in the words of a recent Security Management magazine--"veritable cookie jars," and its patrons convenient marks.
There are also a lot of them now, because they are convenient for customers and financial institutions as well. By the end of last year, there were 59,000 ATMs installed nationwide, more than double the number three years before, according to Spencer Nilson, publisher of a newsletter on the credit card industry. By last year, there were also 135 million cardholders, 43% of them "active" ATM users, Nilson said, meaning that they "use their cards one or more times a month."
Being by definition a money machine, an ATM is a natural place for a holdup, offering robbers "easy access to fast money with a minimum risk," said Sgt. Bob Burns, spokesman for the Sacramento Police Department. ATM users are even more likely to have gone there to get cash than customers emerging from a bank branch--two-thirds of ATM transactions are withdrawals, Nilson estimates--and can be more easily seen to have taken money out. They're also more vulnerable standing there because "when you're using the machine, you have to concentrate on the machine," said Richard Martinez, an aide to California Assemblyman Charles Calderon (D-Alhambra), "and you can't look to both sides."
There are already some federal regulations protecting the ATM crime victim, but they protect his pocketbook, not his life and limb. Under a 1978 law on electronic fund transfers, the consumer's liability for unauthorized withdrawals is limited to $50 if he reports the loss within two days. For a while, there was some question of what constitutes an "unauthorized withdrawal": In one well-publicized Texas case, for example, a man forced at gunpoint to withdraw $500 was told that the loss was his because, technically, he had "authorized" it. But the Federal Reserve Board has ruled that if anyone is tricked or forced into using his card, it constitutes an unauthorized transaction, and the consumer needn't absorb the loss.
The more difficult question, San Francisco attorney Roland Brandel says, "involves loss of property or personal injury after the transaction has occurred--where you take out money and take four steps away, putting it in your purse, and up comes the mugger. Then is there any bank liability?"