March 14 2008
Card fraud up again
Card fraud is rising after two years, with card not present and counterfeit fraud accounting for the majority of the fraud.
2007 card fraud figures released by APACS, the UK payments association, show that total card fraud losses rose by 25 per cent in the past year to £535.2m.
Phone, Internet and mail order fraud (card not present) has carried on rising for the fourth year running with a huge 37% increase to £290.5 million from £212.7 million in 2006, back in 2004 card not present fraud accounted for just £150.8 million.
A key driver behind the massive growth on fraud is the 77 percent increase (up £90.5m) in fraud committed overseas by criminals using stolen UK card details – which typically occurs in those countries yet to upgrade to chip and PIN. Fraud abroad now accounts for over one third (39 percent) of total card fraud losses.
Chip and PIN continues to have a hugely positive effect on card fraud committed in the UK. Over the past three years losses on face-to-face transactions on the UK high street have fallen by two-thirds from £218.8m in 2004, to £73.0m last year. Thanks to chip and PIN the 2007 figures also show that fraud on lost and stolen cards (£56.2m), and mail non-receipt fraud (£10.2m), are at their lowest levels for 10 years.
Sandra Quinn, director of communications at APACS, says:
"The banking industry continues to work with law enforcement, the retail sector, the Home Office and organisations such as the charity Crimestoppers to identify ways of actively protecting against all types of banking fraud. This reflects the multi-layered approach needed – an approach that has recently seen the creation of the Payments Industry and Police Joint Intelligence Unit – a vital addition to the UK's fraud-fighting arsenal."
Apacs goes on to say “Tackling card-not-present fraud is a priority and the industry continues to encourage cardholder and retailer take-up of MasterCard SecureCode and Verified by Visa - secure online payment systems that help prevent online shopping fraud.”
APACS also seem to “justify” the rise in card not present by claiming it’s actually a reduction when viewed in the context of “huge increases in the amount of people shopping online.”
Which strikes us as the perfect example of combining; washing your hands of any responsibility and closing the stable door after the horse has bolted
The recent comments we have had on Verified by Visa from retailers and payment providers are frankly damning, in fact to say that retailers hate Verified by Visa would be a drastic understatement. It’s a transaction killer, and it’s just not understood by consumers, who are more likely to think it’s a phishing attack rather than a force for good.
