U.S. Secret Service Cracks Down on Card Skimming, Reveals Ties to Domestic Money Laundering
In 2025, the U.S. Secret Service embarked on one of its most ambitious anti-fraud enforcement efforts in recent memory — a nationwide campaign to locate, dismantle, and prevent card skimming devices that harvest payment and benefits card data used to fund additional criminal activity. While credit card skimming is far from a novel concept, this unprecedented law enforcement sweep has identified deeper connections to broader money laundering and organized financial crime activity both domestically and abroad, with the U.S. government hoping that additional enforcement efforts in this regard will assist in their greater anti-money laundering (AML) and counter terrorism financing (CFT) initiatives.
The rise of digital payment options has undeniably streamlined the financial and retail spaces over the past decade, while also creating additional avenues for criminals to exploit. During this period, the use of payment cards has skyrocketed across the country. As of the fiscal year 2024, the Federal Reserve’s Diary of Consumer Payment Choice found that credit cards accounted for 35% of all U.S. consumer payments, while cash payments dropped to 14%.1 As a result, card skimming over this period has evolved into a major threat, with the U.S. Federal Bureau of Investigation estimating that annual losses on behalf of both consumers and financial institutions related to these activities exceed $1 billion collectively. In spite of advancements in financial technology seen over this time, the practice of card skimming itself remains a deceptively elementary process. Criminals generally attach or embed hidden devices onto payment terminals such as ATMs, gas pumps, or other point-of-sale systems to capture card data and personal identification numbers. The skimmers themselves can be installed in mere seconds – sometimes by exploiting moments when clerks are briefly distracted, or when the bad actor himself is filling up at the pump – and from there quickly siphon data that fuels broader criminal networks. This stolen information can be used directly to make online purchases or payments, with these payment details also able to be written onto cloned cards and used to withdraw money or make purchases without the victim knowing that their details were compromised.
Credit cards are not the lone targets however. Government-backed benefit programs such as the Electronic Benefits Transfer (EBT) system have also become increasingly exploited over recent years due in large part to multiple factors contributing to their susceptibility to fraud. These include the fact that most EBT cards still rely on magnetic stripe technology and lack modern encryption features like EMV chips. This coupled with the predictable schedule of benefit deposits makes these cards easy targets for criminals to compromise. All told, these exploits can be widespread, covering hundreds to potentially thousands of individual locations at one time. The funds ultimately gained from these activities continue to fuel the operations of the criminal organizations that employ them, with the profit-to-risk ratio of these exploits remaining much more lucrative than traditional forms of organized crime that carry far greater risk of prosecution and longer jail sentences.
Faced with these rising threats, the U.S. Secret Service partnered with federal, state, and local law enforcement agencies throughout 2025 to conduct 22 targeted operations across the country. As part of this coordinated action, agents inspected nearly 60,000 terminals at more than 9,000 businesses, including ATMs, fuel pumps, and retail point-of-sale machines — uncovering and removing 411 illegal skimming devices in the process, with the agency estimating that this campaign prevented more than $428 million in potential fraud losses.2 The operation covered both commercial and public spaces across major Metropolitan cities and smaller jurisdictions across the United States, ranging laterally from Los Angeles to New York City, and vertically from Miami to Anchorage, and covering dozens of cities in between. As is often the case, these hidden devices were found even when business owners believed their equipment was secure.
“The U.S. Secret Service is committed to combatting EBT fraud and credit card skimming throughout the country. These proactive operations are aimed at finding and removing devices before criminals can recover the stolen card numbers they contain,”2 said Kyo Dolan, Assistant Director for the U.S. Secret Service’s Office of Field Operations. “These operations are only the start. We are working closely with our local, state, federal and international law enforcement partners to investigate and dismantle the criminal organizations that perpetrate these crimes.”2
At its core, this crackdown isn’t just about protecting individual consumers or small businesses. It also intersects with fundamental anti-money laundering concerns. Criminal enterprises that deploy skimming devices often rely on the proceeds of fraud to fund further illegal activity. Cloned cards and stolen account information are frequently sold on underground markets, where they may be laundered through complex financial pathways before being reintroduced into the legitimate economy. While skimming itself is a type of property and identity fraud, the stolen funds and associated card data often become the source of raw materials for money launderers. Criminal networks may route fraud-derived funds through multiple accounts, fintech platforms, and cryptocurrency outlets to obscure their origin — often skirting suspicious activity reports (SARs) that banking officials, regulators and law enforcement analyze for signs of deeper networks at work and thus allowing these illicit operations to continue. Monitoring, disrupting, and seizing these devices in the manner carried out by the Secret Service helps cut off one of the pipelines through which illicit proceeds enter the broader financial system – one of the core objectives of today’s AML enforcement efforts seen domestically.
To further break this cycle, the Secret Service went beyond device removal in educating the aforementioned business owners and frontline workers on how to spot signs of tampering, recognize suspicious devices, and how/where to report them promptly. For consumers, simple precautions such as inspecting card readers for loose or unusual components, favoring contactless (i.e. tap-to-pay) or chip transactions, and shielding PIN entry can make a tangible difference, and the U.S. government is attempting to spread the word to increase vigilance and limit the losses from these pervasive activities. The FBI and other authorities also continue to emphasize that digital fraud and physical skimming often go hand-in-hand with broader cybercrime trends. More sophisticated ransomware and web-based skimming campaigns, such as “Magecart” attacks that inject malicious code into merchant sites, have shown that the modern financial criminal is capable of diversifying how they pilfer card data — and current AML efforts must adapt accordingly.
All told however, the Secret Service’s 2025 operations against card skimming were not a one-off event, but the opening salvo in an ongoing campaign that is expected to grow even further in range. The involved agencies have signaled that this work will continue into 2026 and beyond, with an eye toward dismantling the criminal networks behind fraud schemes rather than merely removing devices after the fact. This approach reflects the evolving nature of AML enforcement today: Increasingly blending data analysis, physical enforcement, and international cooperation to disrupt financial crime at every level. By targeting skimming devices before stolen data enters illicit markets, law enforcement not only protects consumers and lawful commerce – it also reinforces the integrity of financial systems that money launderers and fraudsters alike seek to exploit.
Citations
- Federal Reserve Financial Services. 2025 Findings from the Diary of Consumer Payment Choice. Published 2025.
- S. Secret Service. Secret Service card skimming operations prevent more than $400 million in fraud loss in 2025. Published January 7, 2026. U.S. Secret Service Media Relations. News release; 2026.