In the recent past, FBI laid their hands on a 14 member gang for devising an elaborate scam to steal $1 million from Citibank.
The loophole discovered was simple – a 60 second gap in updating account balances. This somehow was figured out by Ara Keshishyan, who designed the whole setup.
The following was the process flow:
- Ara recruited casino players to open multiple Citibank checking accounts.
- Ara supplied the seed money to fund the accounts to the selected casino players.
- Once the accounts were funded, the group travelled to the nearby Casinos.
- Once at the casinos Ara and his fellow conspirators used cash advance kiosks (all within 60 seconds) several times the amount of money deposited into the accounts, by exploiting the Citibank security gap.
- The multiple transactions would only show up as only one withdrawal to Citibank.
- The deposits and withdrawals were below $10000.00 to avoid automated reporting to the federal authorities.
What are Cash Advance Kiosks?
Cash Advance kiosks are an integral part of Las Vegas Casinos. Basically in casinos, the success depends on the players’ access to cash to place bets on the casino games. Cash is preferred over ePayments, and it is here Cash Advance Kiosks come into play.
Like everything in machines, ‘Cash Advance Kiosks’, are of multiple types. There can be multiple cash disbursement points @ at the cashier, at a free standing kiosk and at the ATM.
The actual cash disbursement options depend on the risk appetite of the Casino and their bankers. With advances in technology, the Casinos too can get the corresponding credit in their bank account seamlessly. Automated system deposits can transfer funds electronically after the cash advance occurs. Well, in a way, this is where the whole crisis started. There was a gap of 60 seconds between the Cash disbursal and the corresponding debit in the customer’s account. This gap was exploited by Ara and Team.
I am sure now Citibank has updated their systems to update the account balances immediately without any gaps.
No in India, in the online mode, the customers’ accounts are instantly debited, without any time gap. So, you cannot try the above trick.
Re-disseminated by Prashant N. Banker by daytime, Blogger by night.
- Citibank And Casino Cash Gone In 60 Seconds And Bad Guys Comped (forbes.com)
- 1 Million dollar hacked in 60 Seconds from Citibank (engineeringevil.com)
- Thieves grab $1M in 60 seconds (bankrate.com)