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Beware Of Swipe Scam

It was at the sunglasses boutique in New York's famed Bloomingdale's, CBS News Correspondent Randall Pinkston reports, that cutting-edge fashion came face-to-face with high-tech fraud.

After turning over his credit card to the woman behind the counter, a customer noticed the clerk swipe his card twice. The second time, she swiped the card through "a palm pilot with a credit card skimmer attached to it," explains NYC Police Commissioner Howard Safir. "The device is capable of storing thousands of credit card numbers."

The employee was arrested, and Bloomingdale's and other retailers were confronted with just the latest weapon in the battle over credit card security.

Bloomingdale's Senior Vice President Anne Keating says the store has fought scams with "electronic computers that actually have done away with a lot of the paper receipts, as well as a paper receipt given to the customer that doesn't have the entire number."

If you didn't have enough reasons to be stressed out as the biggest shopping day of the year approaches, here's one more: These days, your credit cards are more vulnerable than ever to fraud. Estimated annual losses, fueled in large part by electronic rip-offs, are in the billions.

"This is really kind of a race between credit card companies and the criminal element," thinks Keith Slotter, head of the FBI's White Collar Crime Squad in Meriden, Connecticut. "You've got creditors who are trying to do the right thing and put safeguards on these cards, and on the criminal side you've got criminals who are doing everything they can to overcome these safeguards and expose them and commit fraud."

Keating says that at Bloomingdale's, short-term hires for the holiday season are well interviewed and monitored closely.

And with security cameras and security checks, retailers are fighting to stay a step ahead of the con artists -- even when they're behind the counter.