Attempted fraud on pre-paid payment cards rose 50% in 2006, with mobile network owners increasingly at risk, according to Retail Decisions, a payment card issuer, processor and fraud prevention firm.
Based on 11 billion transactions, Retail Decision saw a 50% rise in attempted card fraud on prepaid top-up cards in 2006 compared to the previous year, the firm said. Retail Decisions said 58% of fraudsters are less likely to perpetrate fraud with the same merchant after an unsuccessful attempt.
In July 2007 the Nokia 8600 was the most fraud-prone handset, it found. The most fraudulent day on record for pre-paid card fraud was New Year's Eve 2006, when the firm saw an increase of 110% compared to a normal Sunday.
Retail Decisions added it has signed a three-year contract with Virgin Mobile to screen and process more than 15 million payments per year across the virtual mobile network operator's call centre, internet and interactive voice response sales channels.
It will process, authorise, authenticate, settle and screen an estimated 50 million transactions during the contract, with each transaction processed in less than half a second, using its proprietary Red Shield fraud prevention system.
The service analyses transactions based on customisable rules developed specifically for Virgin Mobile. The rules range from basic analysis of the frequency and location of transactions, to complex analysis of different factors that will indicate that a transaction is fraudulent.
Red Shield provides a real-time risk assessment recommendation designed to allow Virgin Mobile to reach a balance between preventing fraudulent transactions, while maximising business from genuine customers, said Retail Decisions CEO Carl Clump.
Clump claimed three quarters of all UK mobile network owners used his firm for fraud prevention. They include Virgin Mobile, AT&T, T-Mobile, Vodafone, O2, Hutchison 3G, MTN, Du, Telfort and The Carphone Warehouse.