The UK Card Association along with the Cheque & Credit Clearing Company, Financial Fraud Action UK and other industry groups has produced their report on UK fraud activities during 2011.

The results released in March 2012 show, Fraud losses on UK cards fell 7% from £365.4m in 2010 to £341.0m in 2011, a ten year low.

The reductions have been attributed to the efforts of the industry to “deter, detect and prosecute fraudsters”.

Card Scheme initiatives have been noted as working, for example:

  • MasterCard SecureCode
  • Verified by Visa
  • American Express SafeKey

Awareness and technology have combined to improve fraud protection by:

  • Offering advice to retailers and consumers
  • Improved the sharing of fraud data and intelligence within the industry
  • Sharing fraud data with law enforcement
  • Chip and PIN equipment
  • Fraud detection tools

Payment Card Industry Compliance was not mentioned in the release but from experience the majority of awareness campaigns, training and policies implementations by Merchants have resulted from the mandates of PCI DSS.

Of interest is the switch in direction by the fraudsters to older fraudulent methods e.g. telephone and cheques, see the exact numbers at the end of the post.

Melanie Johnson, Chair of The UK Cards Association comments:

Driving down fraud and keeping cards safe continues to be a priority for the industry. This is the third year card fraud losses have fallen – clear proof that our endeavours to fight fraud are packing a punch. Customers have also played their part in driving down losses by taking heed of advice about looking after their personal and financial details. Fortunately, they can always be confident that if they are the innocent victim of fraud, they have excellent fraud protection that they don’t get if they use cash.”

DCI Paul Barnard who heads up the industry-sponsored police squad, the Dedicated Cheque and Plastic Crime Unit says:

As technological advances have made our payments more secure, we’ve seen a spike in more simplistic crimes. Many scams involve customers being conned into handing over their cards and PINs, or their telephone banking security details by someone calling, pretending to be their bank or police. Our appeal to the public is to be wary of any unsolicited phone calls or emails. Never hand over your card and PIN or bank security details in full as neither your bank or the police will ever ask you for these.”

UK Fraud broken down by type over the past 5 years is shown below:

Card Fraud Type on UK-issued credit & debit cards 2007 2008 2009 2010 2011 % +/- 10/11
Telephone,   internet and mail order fraud (card-not-present fraud) £290.5m £328.4m £266.4M £226.9m £220.9m -3%
Counterfeit   (skimmed/cloned) fraud £144.30 £169.8m £80.9m £47.6m £36.1m -24%
Fraud on lost or stolen cards £56.2m £54.1m £47.7m £44.4m £50.1m 13%
Card ID theft £34.1m £47.4m £38.2m £38.1m £22.5m -41%
Mail non-receipt £10.2m £10.2m £6.9m £8.4m £11.3m 34%
TOTAL £535.2m £609.9m £440.0m £365.4m £341.0m -7%

See a summary of the 2010 figures here.