Credit Card Fraud Decreases By Michael Lennan At Isnare.com Ezine Articles

With the use of credit and debit cards increasing all the time, the issue of card fraud is always an important consideration. Credit card providers and card processors are now focusing their attentions on providing ever more sophisticated security systems to stay one step ahead of the fraudsters, but there will always be an onus on the customer to act in a responsible manner to prevent fraudulent use of their card.

In the UK APACS, the Association for Payment Clearing Services, monitors and reports on credit card fraud in a six monthly report and the statistics show that card fraud had reduced by 25 per cent in the two years following 2004 but 2007 brought a 25 per cent increase largely caused by higher levels of phone, internet and mail order fraud, where the card holder is not present and an even bigger increase in counterfeit card fraud, where cards are skimmed or cloned. This type of fraud increased by almost 50 per cent and made up over a quarter of all card fraud.

By far the biggest area for concern is card fraud that takes place abroad. Of the £535m lost due to card fraud in 2007 nearly 40% of that loss is conducted abroad using stolen UK credit card details. Although chip and PIN has contributed to the reduction of fraud in the UK there are many countries yet to implement the technology. The introduction of the technology to the UK is claimed to have reduced face-to-face fraudulent transactions by two thirds and other types of credit card fraud are at their lowest levels for ten years.

The police forces are now taking card fraud very seriously with specialist units looking at different areas of crime. In response to the finance industry’s claims that a significant proportion of card fraud was carried out by insider sources in forms and retailers, greater involvement of the Police has reduced this problem. However

Further information on how to avoid card fraud is provided by the website http://www.cardwatch.org.uk managed on behalf of the UK banking industry by APACS.

Here you can read about various approaches being adopted by the industry to prevent credit card fraud. Information is also provided by the different card issuers about how customers can protect themselves against loss due to fraud. The credit card companies discuss various types of card transactions and how customers can protect themselves during them.

Card issuers now have sophisticated fraud detection systems that can quickly identify any abnormal transactions on your account and flag them up to their fraud detection departments. These “out of character” transactions may only be small initially as, apparently, the criminals will try out the card issuers detection systems with a small amount before attempting a large hit.

The problems of internet transaction fraud are being addressed slowly by the Verified by Visa system and Mastercard’s SecureCode system. These are similar to Chip and PIN but require the customer to enter part of their online security code during the authorisation of a transaction. The technology can also be applied to transactions on foreign websites which should prevent the spread of fraud as more people make internet purchases across country boundaries. Information on these systems can be found on the website http://www.shopsafeonline.org.uk which provides information for consumers and retailers and also allows people to enrol in the schemes. If you hear the term 3D-secure, that is a reference to the underlying technology that supports both the Visa and Mastercard systems. The system doesn’t require any hardware, but there is talk about rolling out small consumer verification devices in the future, similar to those provided with some business bank accounts. All of these measures are aimed at reducing credit card fraud and increasing consumer’s confidence in card-based transactions which are generally cheaper for retailers and banks to process.

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