Florida Banking October 2022

BANCSERV ENDORSED PARTNER: STS GROUP

CASE STUDY: CADENCE BANK COMBATS ATM FRAUD AND THEFT WITH THE HELP OF STS GROUP

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BY ADAM STEPHENS, VICE PRESIDENT OF SALES AND MARKETING, STS GROUP

C adence Bank has more than 400 branches across the Southeast, stretching from Texas to Florida. Keeping these branches secure from ATM and ITM fraud and theft is no easy task for SVP/Director of Corporate Security, Christopher Heath. “In today’s climate, any bank security leader knows it’s only a matter of time before your branch faces ATM fraud or theft. All ATMs and ITMs, including island units, are vulnerable to this rising security threat,” said Heath. Since Covid-19 entered our global vocabulary, the world has seen a sharp rise in ATM fraud and theft, including smash-and-grabs, skimming and jackpotting. According to a recent article published by the Federal Reserve Bank of Atlanta, in Europe alone, jackpotting attacks (where criminals gain physical access to an ATM and insert a virus that instructs the ATM to dispense cash) represented a 44 percent increase in number of attacks and a 14 percent increase in losses from 2019-21. Similar trends are being seen in the United States, although the statistics are more difficult to track. “Criminals are no longer hiding in the background. They seem to be getting more bold with their attack methods,” Heath said. “We have seen this personally at Cadence Bank.” Smash-and-grabs are also on the rise in the United States. Beginning as a trend among Texas gangs, the hook and chain method has now become a national gang activity favorite. According to a July 2021 article on convenience.org highlighting the rise of ATM smash-and-grabs, police say these ATM crimes are often initiation rites for future gang members, a trend now known as Chain Gangs. The thieves strike during the early morning hours with a stolen truck or tractor; use a crowbar to pry open the ATM’s front cover and attach chains to remove the safe door, exposing the canisters of cash inside. The process takes five minutes or less.

Criminals have perfected the art and science of this new brazen crime against financial institutions. Like every other financial institution across the country, Cadence Bank has also seen a sharp rise in smash-and-grabs, jackpotting and other ATM crimes over the past few years. Last year, they recorded footage of a smash-and-grab attack that took only two minutes to execute from beginning to end. The financial loss incurred from these attacks includes not only physical cash loss, but also ATM/ITM replacement costs and increased insurance rates. The expense of replacing an ATM or ITM is often greater than the cash stolen. This often leads to skyrocketing insurance costs. According to the convenience.org article, in the 52 weeks ended June 2021, Travelers insurance saw a 257 percent increase in the number of insurance claims related to ATM smash-and-grabs. To formulate a plan to combat this escalating problem, Cadence Bank knew there was only one company to call. They called in the experts — STS Group. “STS Group has been our go-to physical security and branch automation partner for over a decade,”

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