SIOUX CITY | The Sioux City Police Department is warning people to monitor their credit card activity daily, after likely cloning incidents where about 20 local residents reported unauthorized transactions on their cards.
Lt. John Horton in a Thursday release said the department on Nov. 2 began receiving multiple reports of unauthorized activity on cards. He said while the investigation is in early stages, it appears some card information was obtained from data breaches at a Sonic Drive-In and the Kmart before it closed earlier this year.
National reports in recent years show cyber criminals have gained access to the point in a retailer's system where customers make purchases. The thieves install malicious software to collect and retrieve data from the magnetic stripes on the backs of debit and credit cards.
"We are seeing a new trend in credit card cloning and the theft involved. The cloners can see the location the card was issued from, then they travel to that location. They make an Internet transaction, then cancel it to insure the card is active, then make a small purchase, usually for a prepaid card," Horton said.
He explained such small-dollar purchases don't get detected, since they don't meet the requirements for many fraud alert systems.
Horton said if people see strange card activity, they should contact both the police department and the financial institution that issued the card.
He said the data breach at the former Kmart took place from September 2016 to April 2017. The breach at Sonic happened from April through October this year.