Credit Card Fraudsters Target the Net and Phone

Although traditional credit card fraud is on the decrease due to the success of chip and pin, Net fraud is on the increase due to this success as criminals look for more lucrative pastures.

Figures released last week by industry body Apacs shows that shopping online has become more risky. The figures also show that there has been a reduction in fraud levels in the traditional areas of card fraud due to the introduction of chip and pin. As a result, fraudsters now have switched their attention to the web and the telephone.

The first half of this year saw a 30 per cent rise in card not present fraud (CNP) – which covers areas such as the web, phone and mail order – costing the industry £90.6 million. More traditional card fraud such as cash machine, overseas card fraud and stolen card fraud, fell during that period.

Card fraud of any description is now so common that almost everyone knows someone in the UK who has been a victim of card fraud. These epidemic levels have seen losses to the industry rise by more than £65m in the past five years.

There has been an alarming rise in cases where card holders have been the victims of online card fraud. Many stories have surfaced where someone has found that there card has been used for purchases they themselves did not make. These stories are all the more frightening when it becomes apparent that the fraudster not only has the card details but also personal information such as the cardholders address and telephone number.

However, whilst these stories tend to highlight the plight of the cardholder, it is retailers who shoulder the burden and costs of fraudulent CNP transactions, which could result in some smaller retailers going out of business.

Some retailers have said that since the introduction of chip and pin that the level of fraudulent transactions on their websites have risen dramatically. To combat this retailers have to invest further in their online security measures.

It is hoped that the launch in the UK of a US piloted scheme, known as the Visa and MasterCard SecureCode where cardholders can use one-off passwords while shopping online, will help protect both online retailers and consumers. If both the online merchant and the consumer have signed up to the scheme then liability for fraudulent transactions then shifts to the card provider.

Implementing some simple security measures, such as ensuring your ant-virus programme is up to date, ensuring your browser is set to the highest level of security, using only secure sites for card transactions and keeping an extremely close eye on your card statements, should go some way to keeping you safe online.