Putting ‘cash for phones’ ecoATM security to the test

Thieves using stolen phones to make a quick buck

Stolen phones are landing in phone recycling kiosks. Victims say the lure of "quick cash" is too good for criminals to pass up.

The idea is simple: recycle your old cell phone for cash. As ecoATM explains online, their cell phone recycling kiosks around the globe keep cell phones out of landfills, and put money into consumers’ hands.

That said, stolen phones are landing in those same kiosks. Victims say the lure of "quick cash" is too good for criminals to pass up.

ecoATM states that they use "extensive security features and processes to deter the sale of any stolen devices and assist law enforcement in investigating and prosecuting suspected cell phone thieves."

The company’s website states that they utilize a third-party vendor called CheckMEND to determine if a device has been reported stolen.

"CheckMEND compiles records from carriers, police, the FBI, and more to create a comprehensive database of stolen devices on an international scale. If the device does not pass CheckMEND's background check, the ecoATM kiosk will reject the transaction," their site reads.

FOX 13 News put those features to the test. Using various old cellular devices, we listed phones as "stolen" through a U.S. National Property Register database. We then ran checks on those devices through CheckMEND which warned us: "The legal title of an item matching your search term and category is in doubt. We recommend you do NOT purchase."

After confirming that CheckMEND flagged our phones, we proceeded to attempt to sell them to ecoATM kiosks throughout the Puget Sound region. We found that while some of their safeguards were hard to beat, ultimately the kiosks would offer us cash for phones.

LIVE VALIDATION: PASS

According to ecoATM, no transaction can be completed without the approval of a live verifier.

During our attempts to sell various devices flagged by CheckMEND, we found that ecoATM was capable of stopping us from using a state-issued identification card that didn’t match the seller, and that it would not allow us to cover our face while selling the device.

We tried a combination of surgical masks, sunglasses, and mismatched identification cards, but the system would catch us each time. If we wanted to sell a device, we had to show our face and use a valid identification card that matched the seller.

STOLEN PHONE PREVENTION TECHNOLOGY PROCESSES: FAIL

On the ecoATM website, it states that they "check the device’s uniquely identifying serial numbers through the service CheckMEND.com to determine if the device has been reported stolen."

We did the same thing, and received reports for our devices warning us that they should not be purchased, noting that they were reported stolen to "police, immobilize or another organization other than a phone network."

While that information would be available to ecoATM, the kiosks continually made offers to pay us cash for cell phones listed as stolen. It didn’t matter if they’d been on the list for a day, a week, or in one case, 15 days.

An ecoATM rep disputed the validity of our findings, arguing: "When the phones were put in the kiosk, CheckMEND tapped into the GSMA database and confirmed that neither device was reported as stolen."

GSMA is the industry network for mobile operators and the system of record for commercial enterprises in the US.

We similarly put an iPhones into "lost mode" which forced a message onto the screen reading: "This iPhone has been lost. Please call me."

The phone was promptly purchased by an ecoATM kiosk. In that instance, we heard back from ecoATM’s customer service department requesting us to "remove the device from your iCloud or Android account."

The representative did, however, state that if our device was sold to us by someone other than ourselves, to contact their customer service team. We never received such a call for our phones that were marked as "stolen" on the CheckMEND reports.

LAW ENFORCEMENT ASSISTANCE FEATURES: PASS

ecoATM has listed a number of features that make it easy to work with police. They list: an ability to open the kiosk for police, return of reported stolen items, a 30-day inventory hold, device flagging and more. A number of police departments reported that they can, and have, worked with ecoATM to return devices "in a timely manner."

All in all, it would appear that ecoATM’s safeguards may stop some stolen phones from entering their kiosks, but it’s clear they end up in their possession anyway.

In addition to our tests, we have interviewed a victim of theft who needed to utilize the help of police to retrieve her phone from inside a kiosk in Seattle. Other media outlets have reported on similar situations, with phone theft victims later finding out that their phones were sold for cash at ecoATM kiosks.

That said, it appears avenues remain open to return a phone to a victim after a police report has been filed.

Those victims might debate whether the item was returned in a "timely manner," and there’s a lot of frustration for those who are required to spend hours searching and filling out paperwork to get their own devices back.

A bigger question remains: do the kiosks incentivize illicit activity?