The latest fraud figures released by APACS show that the annual level of Card Not Present fraud in the UK has risen once again, increasing from £290.5m in 2007 to £328.40m in 2008, a jump of 13%. Card Not Present fraud, which includes phone, Internet and mail order fraud, now accounts for 54% of all card fraud losses, according to APACS. From 2001 to 2008, Card Not Present Fraud losses have risen by a massive 243 per cent.
APACS notes that tackling this fraud is a priority, “and it should be,” says Paul Simms, fraud expert and Managing Director of fraud prevention specialists, the 3rd Man, “given that businesses are losing millions of pounds each year and this cost inevitably is being passed on to consumers whose pockets are being hit from every angle.”
However, the 3rd Man questions the APACS figures, particularly as the losses announced need to include fraudulent transactions on non-UK issued cards, and this is not clear.
This picture of fraud does not capture the number of attempted Card Not Present frauds which are actually much higher than these official statistics show. “It is also important to note that more businesses are now actually protecting themselves better than ever, working together in partnership through shared data schemes,” says Paul Simms. “Retailer initiatives are preventing hundreds of million pounds of attempted frauds. The rate of prevention is far in excess of the announced figures and consumers should be reassured that the Internet is a safe place to shop and continues to make significant progress.
“It is only those businesses who are failing to take suitable precautions which are being worst hit.”
The 3rd Man has pioneered a scheme whereby any attempted frauds detected by its systems are made available to banks. This information significantly assists banks in early detection, however it is clear from the trend that although such fraud prevention is a ‘priority’, the trouble is that it appears to be a ‘low priority’.
“Chip and PIN has been rolled out and it has been a great success,” says Simms, “however the same level of effort must now be focussed on CNP fraud. This can be achieved by having everyone working together and building on progress made.”
About The 3rd Man Group - www.the3rdman.co.uk
The 3rd Man provides card not present fraud screening, card fraud analysis and consultancy services to some of the UK’s leading retailers, including Argos, Halfords and Ticketmaster.
The 3rd Man reliably detects in excess of 95% of fraudulent attempts including organised and casual fraud.
The 3rd Man also provides its GateKeeper secure online data reporting and analysis tool that enables clients to search for and display transactional information instantly, performing complex analysis to identify fraud rings quickly.
Sharing data - SuperSearch
SuperSearch is a screening service which is used by retailers throughout the UK. It works by providing retailers and banks in any location with a reciprocal connection to fraud screening services. When a transaction is rejected because an attempted fraud is detected, details provided by the suspected fraudster are made available anonymously to all users. Retailers and banks may then take action to prevent further incidences of fraud, not just in the UK but worldwide.
The service works by enabling retailers to share information about fraudulent activity. This information is available to banks upon their application.
Tel: 01483 811234 / 07812 766338
The 3rd Man
Tel: 01276 856444
The 3rd Man
Tel: 0870 874 4999
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