'Low-tech' con threat to consumers
Fraud losses on UK cards have jumped by almost one fifth year-on-year as improvements in technology are driving criminals to target consumers directly with deception crimes.
Some £216.1 million worth of frauds were committed on credit and debit cards in the first six months of this year, showing a 17% rise compared with the first half of 2012 as conmen turn their attentions to duping card holders themselves, according to Financial Fraud Action UK, which prevents crime on behalf of the financial services industry.
The industry body said that improvements to card security such as Chip and Pin and better fraud detection by banks such as monitoring unusual spending have prompted a growth in more old-fashioned attempts to trick people into simply handing over their personal details.
Within the half-yearly total, card identity theft rose by almost one quarter (24%) compared with the same period a year ago, with £18.1 million worth of losses due to this type of crime.
Types of fraud where the card holder is not present, such as when purchases are made over the phone, online or by mail order, also saw a 23% year-on-year rise, with £142 million worth of losses recorded.
One example of the growth in con tricks to get hold of people's card details is a telephone scam called "vishing", which 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.
Sometimes, the conman will ask the victim to call the bank back to check that the call is authentic. But the criminal does not put the phone down at their end, meaning that the landline is kept open and the victim wrongly thinks they are speaking to their bank.
Another similar fraud involves the criminal posing 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. The victim is asked to key in their Pin number on their phone keypad, enabling the fraudster to decipher the Pin number from the audio tones.
Couriers will often be sent to the victim's home to pick up the card on the basis that it is being returned to the bank. But 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.
Despite the recent upturn in frauds, card fraud losses are still almost one third lower that a peak of £304.2 million seen in the first half of 2008.
The latest figures also showed that losses due to people not receiving their cards in the post plummeted by almost one third (28%) compared with a year earlier, with £4.6 million worth of losses recorded. Financial Fraud Action said it has been working with the Royal Mail to disrupt organised gangs.
Telephone and online banking fraud losses are also down by one fifth (21%) year-on-year, with £22.3 million worth of losses recorded.
The drop was put down to better intelligence-sharing across the banks as well as a crackdown on "phishing", where criminals send out emails pretending to be from a bank in order to get victims' usernames and passwords. An 87% drop has been seen over the last year in the number of phishing websites.
Detective Chief Inspector Dave Carter, head of the Dedicated Cheque and Plastic Crime Unit (DCPU), which targets fraud on behalf of the banking industry, said: "The move towards these low-tech crimes of deception highlights the importance of consumers knowing how they can protect themselves.
"Don't be fooled: your bank or police will never call, visit or email you to request your full log-in details or complete four digit Pin.
"If someone claiming to be a bank or police officer asks you for that information, they are always a fraudster."