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Drop in UK Credit Card Fraud - What it Means for You?

8th March 2011

The UK, through the concerted efforts of various institutions, has managed to lower credit card fraud cases for two years in a row according to research published today (9th March 2011). But this war against financial criminals has not been easy, especially now that technology makes these crimes easier to perform yet harder to trace.

The Role of the Banking Institutions

Banking institutions, through the Financial Fraud Actions UK, have become even stauncher in their efforts to protect their respective clients. So not only are procedures to track these crimes being advanced, but measures to curtail them have been put in place as well. These are:

  • Information campaigns targeting retailers are constantly forwarded. This is to educate the latter as to the various effective methods to guard their Chip and Pin equipment from illegal attacks.
  • Initiatives toward improving the technology of chips used on credit cards is being undertaken as well.
  • Making available fraud detection tools and knowledge to both the retailers and the consumers.
  • More and more merchants have been encouraged to get involved with credit card fraud prevention initiatives. Major UK merchants such as British Airways have signed up for identity-checking services such as Verified by Visa and MasterCard SecureCode to step up security for online transactions.
  • More sophisticated software programs that detect suspicious financial activity have now been put into use by UK banks.
  • Sharing of intelligence and fraud data to come up with measures to effectively stop, expose, and go after criminals are in place as well.
  • Release of more advanced Chip and PIN equipment to other countries has been done to protect Britons who use their credit cards overseas.

The Role of the Police

Of course, no amount of steadfast measures against credit card fraud is effective without support from the UK police. With the banking industry sponsoring a special task force called the Dedicated Cheque and Plastic Crime Unit (DCPCU), fraudulent activities on credit cards has been made even more difficult to perform. And since the nature of crimes targeting credit cards is almost always international in scope, the DCPCU has made both its expertise and assistance to foreign governments available as well.

Where the Danger Lurks

Efforts to thwart these unscrupulous practices against credit card owners have proven to be effective. However, consumers need to understand that these dangers will never disappear. Criminals continuously come up with newer and more sophisticated methods to make their illegal activities efficient and undetectable. Knowing where the risks lie is crucial to the crimes' prevention.

  • Online channels, mail-order fraud, and cold calling offer the biggest dangers. In fact, a recorded £226.9m have been lost through these means in the year 2010 alone.
  • Next in line is the danger posed by counterfeit fraud, with criminals employing sophisticated equipment to skim and clone credit card information.
  • Unauthorized purchases made on lost or stolen credit cards, while have enjoyed a 7% decrease in 2010, still account for £44.4m in losses in 2010.

What You Should Do

Drives to educate consumers are constantly being undertaken both by the banking institutions and its industry-sponsored partner the police. So heed these safety measures to ensure you do not fall victim to credit card fraud. Here's what you can do:

  1. When making cash advance transactions, make sure to choose only cash machines that are located within bank premises. This is because there is less likelihood that skimming equipment, those that de-code the magnetic stripes in cards to obtain your account information, have been installed on the machines.
  2. Use your free hand to cover your other hand whenever entering your PIN onto the machine's numeric keypad.
  3. Do not give out your credit card information over the phone or online. Bear in mind that banks never cold call or send out unsolicited emails to ask for your account details.
  4. Do not click on any links contained in unsolicited emails purportedly coming from your bank or favorite merchant. These links may direct you to bogus sites that ask for your card details as a supposed measure to protect your account from hackers, but in truth, are only trying to phish your card ID.
  5. Monitor your card activity and report immediately any unusual or unauthorized transactions. Doing so will greatly improve the chances of quickly catching and prosecuting the illegal offender.
  6. Sign up for identity-checking services Verified by Visa and MasterCard SecureCode. This way, you are more protected whenever making purchases online.

Of course, the added protection and peace of mind can only be good for us consumers. But this should not cause us to be complacent. In fact, this drop in UK credit card fraud should make us more vigilant than ever to ensure the continued decline and eventual eradication of these crimes.