Hackers Rig ATMs In Las Vegas Hotel, Secret Service Investigating

While the good hackers were exposing security holes at Black Hat USA and Defcon in Las Vegas, the bad guys were committing the real deal at a nearby Rio All-Suite Hotel & Casino. And now the U.S. Secret Service is investigating reports of a major ATM hack that stole money from users' bank accounts when they tried to withdraw cash from multiple machines.

The ATM scam first came to light when security researcher Chris Paget lost $200 to an ATM machine over the weekend after attending a show at the hotel. Paget, who kept a running log of the events on his Twitter feed, alerted authorities after the machine took his credentials and debited his account, but didn't spit out any cash. He said in his Twitter feed that he met other visitors who had lost money as well -- one man to the tune of $1,000.

Paget this morning was able to cancel his ATM card and reverse the transaction through his bank. "Here's hoping it's that easy for everyone," Paget tweeted.

This, after an evening spent getting the word out about the scam and trying to get the Rio to shut down the machines, which hotel officials wouldn't do initially. They posted "out of order" signs on the machines, but Paget reported that people were just pushing the signs aside and using the machines. He stood by for a while to warn potential victims not to use the machines.

As of press time, it was unclear whether the machines -- which were Diebold brand, according to Paget -- were rigged with malware or card skimmers, devices sometimes affixed to ATM machines and credit-card readers to grab credentials from victims.

Paget says he thinks it was an "inside job" of some sort. "I believe it was either malware or an inside job -- there were no visible skimmers," he said in an interview. "The machine was operating perfectly -- it answered all the steps, and you could even hear the gears whirring when it was supposed to dispense the cash.

"We were wondering if someone blocked the slot where the cash was supposed to come out. Then an insider could come pick it up later."

But given that Paget was unable to examine the machines closely, he says for now it's all "speculation."

The Rio ATM hack came on the heels of another ATM scam spotted at Defcon earlier last week. A suspicious-looking ATM machine was reportedly discovered at the Riviera Hotel, where the hacker confab was being held, and attendees flagged it as suspicious when it was found to have a PC sitting behind the screen. The phony ATM was later confiscated. So far, it's unclear if that scam is related to the rigged ATM machines at the Rio.

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