Card fraud losses continue to fallCriminals hit by chip and Pin

14 March 2007

 

Signing a credit card slip

Credit and debit card fraud is falling in the UK but criminals are continuing to try to empty people’s accounts by avoiding transactions that use chip and Pin technology, new figures out today reveal.

Apacs, the payment association which represents banks and credit card companies, says the introduction of chip and Pin has made it more difficult for fraudsters to commit card fraud in the UK,.

Over the last two years losses at UK retailers fell by £146.7m but at the same time there has been a 16 per cent increase in the amount of fraud on transactions that do not use chip and Pin.

This includes transactions carried out over the internet and via phone and mail order.

Cloned cards

Apacs says that criminals are also trying to copy or clone cards and use them in countries that haven't upgraded to chip and Pin technology.

Sandra Quinn, Director of Communications at Apacs, said: ‘These figures clearly show that there is no one-size-fits-all approach to dealing with fraud.

‘Chip and Pin has had a hugely positive effect on fraud losses over the counter in UK shops and stores, but we are seeing more fraud on transactions that do not use chip and Pin – such as over the internet and phone, by mail order and abroad in countries that have not yet fully upgraded to chip and Pin.

‘Fighting fraud is never going to succeed with a single-layered approach. It requires different sectors – including public and private – to work together on developing and implementing strategies, sharing best practice and, most importantly, sharing data.’

Phishing

The largest growing card fraud, according to Apacs figures, was through a phenomenon known as 'phishing'.

In a phishing incident, fraudsters set up a fake version of a genuine bank website and then send out thousands or even millions of spam emails driving consumers to the site.

The idea is to fool people into giving up confidential personal banking information online.

Last year there were 14,156 incidents of phishing recorded. This compares to just 1,713 in 2005.

Online fraud

Apacs says a number of measures are currently in place to tackle card-not-present and online fraud, such as the MasterCard SecureCode and Verified by Visa schemes.

It urges online shoppers to register with Verified by Visa and MasterCard SecureCode whenever they are given the option of doing so.

Cardholders simply need to register a private password with their card company for use when shopping online at participating retailers.