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Financial fraud declines

Credit card and online fraud fell in the first half of the year but losses from ‘old fashioned’ scams increased

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The scale of financial fraud losses fell during the first six months of the year, the latest figures on the subject showed on Wednesday.

Credit card fraud declined 9 percent compared with last year largely because of the growing prevalence of chip and PIN technology, according to Financial Fraud Action UK.

Losses resulting from online banking fraud were down 32 percent on the same comparative basis, which the campaign group behind the figures attributed to growing consumer awareness of the relevant issues and improvements in fraud detection software.

Credit card users in the UK were defrauded at a total cost of £169.8 million in the first six months of this year, while banking fraud cost consumers around the country £16.9 million, said FFA UK.

“Losses are appreciably lower than they were a few years ago and everyone involved in tackling fraud has reason to be encouraged by this,” said Paul Barnard, head of the police’s cheque and plastic crime unit.

Positivity on the subject was tempered however by data showing a rise in losses due to “old fashioned” financial crime including phone-based, cheque or mail order scams.

PwC’s director of information and cyber security William Beer noted some interesting potential ramifications of a successful clampdown on fraud affecting banking consumers.

“The fact that the banks are doing such a good job in protecting their customers and themselves from online fraud means that organised criminals are now moving more towards other, possibly softer targets, such as the European Carbon Trading Market,” he said.

Beer said public and private sector organisation need to adopt new operating structures and governance policies in order to effectively counter the threat posed to their operations by ‘cyber criminals’.

“It is also important to note that cyber-crime is global, as are many of the banks that criminals target, so figures based solely on UK fraud might not tell the whole story,” he said in response to FFA UK’s latest data release.


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