ATM thieves who stole more than $500,000 from financialinstitutions in the Detroit area were walking away without apunishment and Stephen Dedene, manager of compliance and regulatoryaffairs at the $822 million Credit Union ONE in suburban Ferndale,was in disbelief.

A number of Credit Union ONE's machines had skimming devicesplaced on them over the course of several weeks in the summer of2012, which resulted in losses of more than $90,000 for his creditunion.

Members who used these ATM machines had their debit cardinformation and PIN number stolen without their knowledge. CreditUnion ONE, Credit Union Times Trailblazer Award Winner forOutstanding Political Action, reimbursed them for the stolen funds.Dedene said it is easy to plant a skimming device on an ATM buthard to spot one.

“These devices are available and it's not illegal so someone canjust go right on to eBay or any of those search engines and searchhow to skim an ATM,” he said.

The U.S. Secret Service, state and local authorities arrestedtwo individuals in connection with the skimming crimes a few weeksafter the incidents occurred.

“They served no jail time; they paid no restitution; they had nofines, nothing. It didn't exactly sit well with me,” Dedenesaid.

According to the FBI, the U.S. Secret Service investigates alarge number of ATM skimming cases.

“Through FBI investigative experience, we have learned that ATMskimming is a favorite activity of Eurasian crime groups, so wesometimes investigate skimming—often partnering with the SecretService—as part of larger organized crime cases,” said the officialFBI website.

Dedene said the thieves were not charged because there was not aMichigan state law in existence that dealt directly with ATMskimming.

“It turns out, the only thing on the books was a misdemeanor forusing a device to record a personal identification number and thatmisdemeanor was imprisonment for up to one year or a fine of notmore than $1,000,” he said. “That's really the only law thatMichigan had on the books. I decided that our laws are not keepingup with the pattern of fraud. As fraud evolves, our laws are sortof lagging behind.”

In February 2013, Dedene organized meetings with some Michiganstate lawmakers and representatives from the Michigan Credit UnionLeague about the impact of ATM skimming on credit unions and theirmembers as well as the lack of laws to prosecute such crimes.

State Rep. Ellen Cogen Lipton (D-Huntington Woods) had offeredto further research current state data theft and fraud laws, whichultimately confirmed that the only related law prohibits recordingpersonal identifying information such as a PIN number. Violationsof the existing law would only lead to a misdemeanor ofimprisonment up to one year and a fine of not more than $1,000.

“Her research came back and basically confirmed what I wastelling them that the laws we have are just not sufficient for thistype of crime, which is a $1 billion a year crime nationally,” saidDedene.

Following Cogen-Lipton's findings, Dedene said the group came upwith a framework for legislation, which included amending theMichigan penal code to outlaw the sale, purchase, installation,possession or transfer of a skimming device. Any violation would beconsidered a felony punishable by prison time for at least one yearbut no more than five years.

“We needed to make the penalty harsher,” he said.

Also included in their framework was replacing the existingmisdemeanor penalties with imprisonment for not more than fiveyears and/or a fine of not more than $25,000 for the first offense,imprisonment for not more than 10 years and/or a fine of not morethan $50,000 for the second violation and imprisonment for not morethan 15 years and/or a fine of not more than $75,000 for the thirdtime.

They also proposed changes to the code of criminal procedure,which included placing the new felony provisions associated withphotographing or digitally transferring personal information from afinancial transaction device into the sentencing guidelines.

“We received some bill drafts back on those proposals and theylooked pretty good. The next thing you know, they are gettingintroduced in the State House, they're passing and we've havingcommittee hearings,” he said. “I testified in front of the MichiganHouse Criminal Justice Committee. It passed that committeeanonymously and went on to the House – all five bills passed theHouse unanimously.”

Looking back, Dedene said the ATM skimming issue was not on theMichigan Credit Union League's radar before February 2013.

“After working on this and bringing it to their attention –working with the lawmakers and working with the league – it jumpedup on their radar screen. We started talking about it at our stategovernmental affairs conference,” he said.

“We turned this into an advocacy issue where we had staff sendtheir lawmakers letters on this issue,” Dedene added.

Dedene also testified in front of the Senate JudiciaryCommittee. Michigan Gov. Rick Snyder signed the package of billsinto law in December.

“These devices are used to steal from others, and we need tocrack down on this problem to help protect Michiganders. This is abipartisan package of bills approved unanimously, showing theunited commitment to fighting this growing issue,” Snyder in astatement.

The new laws with their harsher penalties take effect on April1. And Credit Union ONE is this year's Trailblazer award winner forOutstanding Political Action.

Credit Union Times asked Dedene if the skimming thieves would bebrought to justice retroactively.

“If the law is not on the books at that time, I don't believethey can be because it wasn't an existing law,” he said.

“For nothing to happen is just what infuriated me the most –that we caught them and couldn't do anything about it,” headded.

Judith Desilets, director of public relations at Credit UnionONE, said the new laws would not have been adopted without Dedene'sadvocacy efforts.

“The signing of these bills is a victory for credit unions,their members, all financial institutions, and all individuals whouse ATM and debit cards,” said Desilets. “The issue of ATM skimmingdemonstrates advocacy in its best form at work.”

Dedene said he is honored to be recognized as a Trailblazer.

“I think it shows that if you're passionate enough about anissue and you take the initiative, then good things are going tohappen. All I did was advocate. Advocacy is one of the mostimportant things we do in this industry. If we do not advocate forourselves, no one else will,” he said. “I appreciate the award andI hope that others follow through on what they are passionate aboutto see that change occurs.”