Local 2 investigates recycling kiosk security

By Amy Davis - Reporter/Consumer Expert

HOUSTON - You may have seen new kiosks popping up in shopping malls. They'll pay you on the spot for old electronics, but a local couple said that new technology made it really easy for a thief to cash in.

Local 2 consumer expert Amy Davis put the kiosks to a test and she's exposing a security flaw that has the company responding.

"I feel lost without my phone," said Angie Waller.

Waller's iPhone 4s was swiped from a dressing room at Katy Mills Mall. She discovered whoever had it sold it just a few steps away at an ecoATM in the mall's food court.

The machine pays out cash for used cellphones, iPads and mp3's. It's supposed to make it easy to recycle your unwanted electronics, but some say it's making people, like Waller, an easy target for thieves looking to make a quick buck.

"I feel like they knowingly accept the stolen merchandise and their attitude is more often than not people aren't going to track it back down," said Waller's husband, Vince.

The couple used an iPhone tracker app to locate their stolen phone.

KPRC Local 2 discovered they're not alone. In November, a man in San Antonio tracked his stolen phone back to an ecoATM. That same month, it happened again in Atlanta.

"In each of the cases you've mentioned, we've also been able to return the phones to the people who had them stolen," said Ryan Kuder with ecoATM, the California-based business that has 300 machines in malls across the country.

Kuder said the company does all it can to deter thieves from selling stolen phones. The machine requires the seller to give their thumbprint and scan their driver's license. It takes their picture that an ecoATM employee in California compares while the seller is standing at the machine. Kuder said all of the information is available to police when a phone is reported stolen.

"It's going to be a not very smart thief who sells a stolen phone and then provides their photograph and driver's license to the police department telling them who did it," Kuder explained.

But clearly, even with all those safeguards, thieves are still getting cash. So KPRC Local 2 stopped by a mall with an old cellphone to find out easy it is to beat ecoATM's system. Photographer Jon Hill, a handsome man who looks nothing like our lovely Dominique Sachse, tried to sell an old phone using her driver's license. The ecoATM rejected the transaction. But when Davis presented a producer's driver's license to an ecoATM in Willowbrook Mall, the machine gave her cash for an old phone. It's proof a thief could use a stolen ID.

"It's not a perfect system," Kuder responded. "You guys slipped one through on us yesterday. It's not a perfect system. We try to make it as close to perfect as we can. And when we find a place where it's not perfect, we work on it to make it more perfect."

What's also not perfect, police said, is making a case against a suspect caught selling a stolen phone.

"There's more to it than just saying, "Here's a picture. Here's my phone. They're guilty," explained Katy Police Department Assistant Chief Tim Tyler.

Tyler said it is difficult to prove that the person selling the phone is actually the person who stole it. He said it's why the woman who was paid $90 for Angie Waller's phone has yet to be arrested.

"You really feel violated when something like that happens," said Vince Waller.

"ecoATM paid money to criminals," Davis said to Kuder.

"We did," he replied. "And that money came out of our pocket, which is not good for our business. And that's why we do everything we can to stop that from happening."

Local 2 asked Kuder if anyone has been criminally charged for selling a stolen device to an ecoATM. He said, and KPRC Local 2 confirmed, one man in Maryland was charged with theft based in part on the evidence ecoATM shared with police. His case has not gone to court yet.

Kuder said they have received between 20 and 30 reports of stolen phones in the last two months. He said that is about one report for every 4,000 phones it collected.

If you have a news tip or question for KPRC Local 2 Investigates, drop them an e-mail or call their tipline at (713) 223-TIPS (8477). Copyright 2013 by Click2Houston.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.