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Card fraud losses up by a fifth

a credit card and padlock07/10/13

By Daniel Machin

Improvements in card security have led to a rise in deception crimes as conmen turn to old-fashioned attempts to trick people into simply handing over their personal details.

Figures released by Financial Fraud Action UK show that some £216.1 million worth of frauds were committed on credit and debit cards in the first six months of this year - up 17 per cent on the same period in 2012.

This jump has come about as improvements in technology drive criminals to target consumers directly with deception crimes.

Card identity theft rose by 24%

Within the half-yearly total, card identity theft rose by 24 per cent compared with the same period a year ago, with £18.1 million worth of losses due to this type of crime.

There was also a 23 per cent year-on-year increase in the types of fraud where the card holder is not present, such as when purchases are made over the phone, online or by mail order, with £142 million worth of losses recorded.

So while improvements to card security like Chip and Pin and better fraud detection by banks have protected the consumer against specific types of fraud, they have also opened the door to a number of deception crimes.

Telephone 'vishing' scam

A telephone scam called "vishing" is one of the most popular ways that criminals are trying to get hold of people's card details.

It involves someone posing as a bank fraud investigation officer or a police officer in order to get their victim to hand over information such as their Pin number and date of birth.

The conman will sometimes ask the victim to call the bank back to check that the call is authentic, but this is just another clever part of the scam.

Instead of hanging up after the initial phone call, the criminal remains on the line so that it is kept open. The victim then wrongly thinks they're speaking to their bank when they ring back.

Criminals pose on phone as a bank 

Another similar fraud that often catches the unsuspecting consumer out is when the criminal poses on the phone as a bank to say that someone's card is due to expire or has been subject to fraud and needs replacing.

In this instance, the victim is asked to verify their Pin number by typing it on their phone's keypad. Although this seems harmless, it enables the fraudster to decipher the Pin number from the audio tones given off.

Couriers will often then be sent to the victim's home to pick up the card on the basis that it is being returned to the bank.

But in actual fact the card is delivered to the criminal who can use it along with the victim's Pin to commit identity fraud or go on a spending spree.

Although card fraud losses totalled £216.1 million between January and June, the figure is still almost one third lower that a peak of £304.2 million seen in the first half of 2008. 

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