According to Financial Fraud Action UK (FFA), fraud losses on UK cards totalled £388 million during 2012, showing a 14% increase on the previous year.  Such stark statistics are understandably causing consumers some concern, especially in the run up to Christmas when credit cards are hit the hardest.

FFA also found that this rise in card fraud has come as a result of criminals returning to ‘low-tech’ deception crimes. This has happened because of improved security features like Chip & PIN making it harder for criminals to use technology to steal money from people’s cards.

The scams that are on the rise are often crude and straightforward, designed to dupe customers into handing over their own cards and PINs to the fraudsters directly. This includes distracting people in shops and bars, ‘shoulder surfing’ at cash machines to find out someone’s PIN and then stealing the cards without them noticing, or even tricking them into handing over their card details on their own doorstep.

Another threat is when UK cards are compromised and used in countries where security levels are lower than in the UK, for example where those countries have not yet moved to Chip and PIN.

Online and telephone fraud

Losses on ‘card-not-present’ transactions (i.e.those conducted online and over the telephone) rose by 11% in 2012 (but this needs to be seen in the context of the sharp 18% increase in card spending on the internet  over the same time period).  Online banking fraud rose by 12% in 2012 to £39.6m, largely driven by fake websites which have tricked consumers into giving away their online banking login details.

‘Phishing’ emails and websites are set up by criminals to trick vulnerable customers into believing they are communicating with their bank or building society.  Online banking customers are also being tricked into divulging their login details, passwords and other personal data over the phone (through ‘vishing’ or ‘voice-phishing’) to someone they believe is from their bank but is actually a fraudster.

Know what to look for to beat the scams

‘Shoulder Surfing’ is when a criminal stands behind you at a cash machine and looks over your shoulder to find out your PIN number. The criminals then find a way to get your card, by stealing it from you or ‘skimming’ using a device on the ATM, and withdraw money from your account using your PIN.

To minimise the chances of having your card or card details stolen at a cash machine or in a shop or bar:

• Stand close to the cash machine.
• Shield the keypad with your free hand and your body to avoid anyone seeing you enter your PIN.
• Be alert and put your personal safety first. If someone is crowding or watching you, cancel the transaction and go to another machine.
• Do not accept help from seemingly well-meaning strangers and never allow yourself to be distracted.
• Fraudsters sometimes fit devices to cash machines that trap your card, which they then retrieve as soon as you have left the area.  If your card is retained by the machine for any reason, report it to your card company immediately, ideally using your mobile phone while you are still in front of the machine.  Make sure you have your card company’s 24 hour contact number stored in your mobile phone
• If you spot anything unusual about the cash machine, or there are signs of tampering, do not use it. Report it to the bank concerned immediately
• Once you have completed a transaction put your money and card away before leaving the cash machine. Destroy or preferably shred your cash machine receipts, mini-statements or balance enquiries when you dispose of them

‘Vishing’

Vishing (or voice-phishing) involves a fraudster making a phone call to a potential victim, posing as someone from a bank or building society fraud investigation team, the police or another legitimate organisation such as a telephone or internet provider. They attempt to obtain financial information which often includes credit/debit card details (including PIN), bank account details and personal information such as full name, date of birth or address. This information is then used by the fraudster to gain access to their victim’s finances. The FFA estimate that fraudsters could be scamming £7m a year using this technique.

You should be wary of unsolicited approaches by phone and cold callers who suggest you hang up the phone and call them back (but keep your phone line open by not putting down the receiver at their end).

You should NEVER disclose your 4 digit card PIN to anyone (including to the bank or police), your FULL password or online banking codes or personal details unless you are absolutely sure who you are talking to.

• If you are unsure about providing the information your caller has requested, visit your bank’s website to check their policy on what information they will and won’t ask for.
• If you are suspicious or feel vulnerable, don’t be afraid to terminate the call, and say no to requests for information.
• Criminals may already have basic information about you in their possession (e.g. name, address, account details), so do not assume a caller is genuine because they have these details or because they claim to represent a legitimate organisation.

Courier fraud

Courier fraud is reported to have caused over £7.5m worth of fraud on credit and debit cards between January and August 2012. Over that time, more than 1,600 bank customers fell victim, with average losses per case being over £4,200.

The scam involves a person being called by a criminal posing as someone from their bank, or even the police. The caller tells the victim that their credit or debit card needs collecting and replacing following fraud on their account. Police have found that the criminal caller reassures the victim that the call is genuine by getting them to hang up and call the bank’s number for confirmation. Following this, the criminal caller stays on the line, tricking the victim into believing they are on a new call and that the person at the end of the line is their bank.

The criminal caller will then either ask the person for their PIN or ask them to key their PIN number into their telephone keypad, before sending a courier to collect the card. The victim is told that the card is going to the bank, but actually is delivered to the fraudster along with the PIN obtained during the scam.

• Never hand over your card: Your bank or the police will NEVER ring you to tell you they are coming to your home to pick up your card. Never hand it over to anyone who comes to collect it.
• Never share your PIN: Your bank will NEVER ask you to authorise anything by entering your PIN into the telephone. NEVER share your PIN with anyone – the only times you should use your PIN are at a cash machine or when you use a shop’s Chip & PIN machine.
• Always speak to the bank securely: Before calling your bank, make sure you can hear the dial tone. Only ever call your bank on an advertised number.