Thursday, 3 February 2011

Cross-border ATMs used for currency speculation..?

News this week from Cambodia (Reuters) shows that enterprising Vietnamese citizens have possibly been using ATMs to speculate on the currency market -Vietnamese Dong versus the US Dollar.  The Dollar is used for the bulk of payment transactions in Cambodia.

ANZ Royal Bank (partly owned by Australia and New Zealand Banking Group Ltd) said customers of Vietnam Technological and Commercial Joint Stock Bank (Techcom) had taken millions of US Dollars out over the past few weeks.  $13 million has been withdrawn by Techcom cardholders from the ANZ Royal Bank ATM network over the past few weeks - and the bank has now blocked Techcom cardholders from making transactions.

It is believed that this is also happening with ATM withdrawals from other banks.  Vietnamese taking out US Dollars in Cambodia would have their Dong accounts in Vietnam docked at the official rate, plus fees, but could then change the Dollars back into Dong at the higher unofficial black market rate.

Acleda bank, which has the biggest ATM network in Cambodia, said that it is now limiting withdrawals from its machines to $500 per day (down from $1,000) on the advice of the Cambodian Central Bank.  Apparently $5.5 million has recently been taken out by Vietnamese, mostly from the border town of Bavet.

International ATM networks do seem to provide opportunities for those willing to bend or break laws:

  • Criminals skimming cards and compromising PINs in countries where all ATMs are EMV compliant (Chip enabled) can't use counterfeits of those cards at EMV ATMs, and so take them abroad to countries (such as the USA) where no ATMs are Chip enabled.  Fraudulent cash withdrawals can then take place until the cards are blocked.

  • People with genuine bank accounts in certain parts of the world and looking to launder money, can credit their bank accounts in those countries with 'dirty money' and then travel to other countries to make hard currency withdrawals - thereby gaining clean money.

  • And now we have the possibility of exchange rate speculators using ATMs to play the currency black markets............

No comments:

Post a Comment