On inspection I noticed something suspicious about the card slot.  It looked more worn than the rest of the machine.  To check I took a grip of it and gave it a pull at which point it came away in my hand.  The piece of plastic in question was a card reader that had been lightly glued over the card slot.  

You can see from the pictures above that the reader is manufactured to resemble the slot.  Once in place an inserted card goes through the card reader and into the ATM card slot.  As this happens the information from the magnetic strip on the back of your card is read and stored in the card reader.  When the transaction is completed the card is returned, again through the card reader.  Later in the day the fraudster will retrieve the reader and extract the card information it has gathered.

I took the card reader into the bank and handed it to the manager who assured me the appropriate action would be taken.

I heard a report last week of another such incident in Nairobi.  It therefore seems wise to remain vigilant when using ATMs.  If you think something might be a card reader, try to pull it off the machine.  You can’t break an ATM because it is designed to resist attack with power tools.  If you remain suspicious; use another ATM.