With $1 billion reported annually in ATM-fraud losses worldwide, NCR Corp. has formed an alliance with the University of Abertay Dundee in Scotland to address criminal threats to the machines.

The recently announced corporate-academic alliance seeks to uncover fraud threats to ATMs before they arise through a method known as "ethical hacking," which occurs when a company contracts with a computer-security expert who tries to penetrate the firm's network to determine whether security holes exist that criminals could exploit.
"Ethical hacking is designed to stop would-be hackers and viruses before crimes occur," the ATM maker says.

 The alliance between NCR, which operates a research-and-development center in Dundee, and the University of Abertay will focus on personal-authentication measures required to gain access to ATMs, NCR says.

"The critical knowledge of illicit access to ATMs is an ongoing and a growing threat to many ATM users," says an NCR spokesperson, who adds that the company is not collaborating with its rivals Wincor Nixdorf AG and Diebold Inc.

Companies have deployed some 1.5 million ATMs worldwide, and in Europe alone annual fraud losses have reached $696 million, according the European ATM Security Team, which is based in Edinburgh, Scotland.

NCR and the United Kingdom's Knowledge Transfer Partnerships graduate-placement program are funding the research at the university, NCR says.
The vendor did not disclose how much money it has devoted to the project.
This is the second time NCR and the university have worked together.

An earlier collaboration resulted in the school offering Bachelor of Science and Masters of Science degrees in ethical hacking. Duluth, Ga.-based NCR has incorporated the program's findings into its research and development initiatives, the manufacturer says. ATM

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