CIFAS figures reveal credit and store card fraud on the increase
Frauds identified by the cross sector Members of CIFAS during the first four months of 2013 reveal a marked return to the idea that some products are inherently more attractive to fraudsters.
In spite of an overall decrease in total fraud levels (-16.5%) during the first four months of 2013 – when compared with the same period of 2012 – several changes have taken place in the types of product targeted by fraudsters. Most notable findings include:
• Fraud against credit and store card accounts increased by 28% compared with the first four months of 2012.
• These accounts have resumed the status of the fraudster’s favourite target for fraud; accounting for 25% of all fraud recorded in 2013 between January and April.
• A continued rise in fraud attempts against payday lenders and loan providers.
Since 2009, frauds against plastic card accounts have constituted less than 1 in 5 of all frauds recorded by CIFAS (when it accounted for 27% of the annual fraud figures). But this has changed. In spite of the overall decrease in fraud recorded until the end of April 2013, credit and store cards have experienced a vast increase in the level of frauds recorded. A large proportion of these frauds are accounted for by identity fraud: with fraudsters using the name and details of victims to impersonate them, and obtain a card account in the victim’s name.
CIFAS Communications Manager, Richard Hurley, notes: “Recent years have revealed that fraudsters frequently change their targets, however, so the fact that plastic card accounts are being targeted far in excess of other products indicates that this process of change may have come full circle.”
In addition, loan accounts have become increasingly popular with fraudsters (now accounting for almost 7% of all fraud – increasing by 43% from the January to April period of 2012). The rise in prominence of payday lenders means that fraudsters are increasingly targeting loan providers, as fraudsters have always attempted to defraud new and emerging organisations in the belief that these organisations’ defences might be weaker. In light of this, and the increasing number of payday lenders, responsible counter fraud measures such as data sharing must now be seen as a bare minimum to help this sector combat fraud.
The Retail Bulletin’s 4th Loss Prevention Summit, 10th September 2013 will look at cost-effective loss prevention strategies and solutions– striking a balance between revenue maximisation and fraud loss exposure. If you have a solution or product to help retailers combat internal and external fraud, contact Karen Howard now to discuss the options for being part of this one-day event. If you would like to register as a delegate, click here.
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