In the Media

Card fraud at 11-year low as criminals revert to cheque and phone scams

PUBLISHED October 5, 2011

Online banking fraud and card fraud reduced by chip and pin ? so fraudsters return to low-tech scams The amount of money lost through card fraud and online banking fraud in the UK has fallen again as part of a longer-term downward trend, figures reveal, but at the same time cheque fraud and phone banking fraud losses have soared. Determined fraudsters have reverted to low-tech scams ? as basic as distracting people and stealing their cards ? while initiatives such as the further roll-out of chip and pin have reduced the overall fraud figures. Data from the UK Cards Association reveals that total fraud losses on UK cards fell to ?169.8m between January and June 2011 ? 9% less than in the first half of 2010. This half-year total is the lowest for 11 years and also the third consecutive decrease. The sustained fall is because of the success of a number of industry initiatives such as the increasing use of fraud detection software and updated chip cards, and the increasing roll-out of chip and pin technology abroad. Online banking fraud losses totalled ?16.9m during January to June 2011 ? a 32% fall on the 2010 half-year figure. A variety of factors have contributed to this decrease, including increased customer awareness of computer security combined with banks' fraud detection software. However, phone banking fraud losses rose to ?8.6m (a 48% increase) during January to June 2011. Criminals are focusing on the straightforward crime of duping a customer into believing they are dealing with a bank or police representative and getting them to disclose PINs, passwords and login details, which the criminal then uses to access the customer's bank account over the phone. Lost and stolen card fraud losses also rose, up by 20% from ?21.3m to ?25.7m. DCI Paul Barnard, head of the Dedicated Cheque and Plastic Crime Unit (DCPCU), a police squad sponsored by the banking industry with an brief to help stamp out organised payment fraud, said: "Losses are appreciably lower than a few years ago and everyone involved in tackling fraud has reason to be encouraged by this ? and that includes bank customers who, as their own front-line of defence, have certainly played their part. "However, there has been an increase in old fashioned scams ? criminals using distraction techniques and social engineering methods to get hold of people's cards or phone banking details." Meanwhile, the heatwave looks to have triggered a mini spending boom after the UK's cash machine network reported its busiest day of the year. The Link network said ?577m was withdrawn on Friday as Britons filled their wallets and purses ready to enjoy the sweltering October weekend. Chief executive John Howells said: "The good weather really seems to have encouraged people to withdraw cash in preparation for increased spending over an unusually sunny weekend." Link said the busiest time on Friday was just after midday, when workers would have gone to an ATM while grabbing their lunch. The ?577m bumper withdrawal was the highest daily total since last Christmas Eve. It was also a 14% increase on the same day last year. Scams Credit cards Banks and building societies Consumer affairs Crime Rebecca Smithers © 2011 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds