Although overall card fraud dropped last year, online
and foreign card fraud is still rising at a dizzying pace,
according to UK payments association Apacs.
Overall, the cost of fraud fell 3% between 2005 and 2006 to
£428m, but online banking fraud jumped 44% to £33.5m in 2006.
The introduction of chip and PIN technology has hit the retail
fraudsters, though, with shop till fraud plunging by 47% in
2006.
However, criminals are successfully copying the magnetic strip
on UK cards, with the aim of cloning them to be used in countries
where there is no chip and PIN system in place. This has led to the
fraud abroad figure jumping 43%.
So-called card-not-present fraud losses, covering online, phone
and mail-order transactions, rose by 16%, and now account for just
under 50% of all card fraud losses.
Cheque fraud losses fell from £40.3m in 2005 to £30.6m last
year, as customers used fewer cheques and the banks improved their
verification processes.
Apacs spokesperson Sandra Quinn 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.”
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