Financial fraud declining in the UK
Credit card fraud, check fraud and other forms of related financial crimes are on the decline in the UK, as a recent report from the UK Cards Association found 2010 fraud losses reached the lowest annual level of any year since 2000.
According to the report, debit and credit card fraud costs declined to just above $590 million in 2010. This statistic represents a significant improvement, as 2008 was marked by the highest fraud levels in the country's history, with approximately $988 million lost. The total funds stolen in fraud cases during 2010 was also 29 percent lower than the same statistic for 2009.
The reduction in losses due to fraud cases comes as the UK's banking and financial institutions have recently emphasized the importance of deploying advanced strategies and technologies to help protect consumers and identify criminals. Improving fraud awareness among retailers and pushing such plans as MasterCard SecureCode and Verified by Visa have helped prevent fraud. Encouraging industry sharing to improve fraud-related intelligence, using more chip and PIN-based cards, upgrading EMV chips and using more fraud detection tools were other strategies that helped lower the impact of financial crime in the UK.
Online banking and check-based fraud incidents are both on the decline as well. The report found online losses were just below $76 million, and attributed the 22 percent year-over-year decline to improved deployment of antivirus and fraud detection software by both consumers and business. Check fraud declined by approximately 3 percent, dropping to approximately $47 million during the year. The report said check usage is dwindling, while advances in fraud prevention are helping banks identify most incidents before a check is cashed. These advances in fraud prevention in check-based, online and card-based payments are noteworthy, but detective chief inspector Paul Barnard, head of the Dedicated Check and Plastic Crime Unit, said banks are not getting complacent.
"Whilst another drop in fraud is good news, the fraudsters haven't shut up shop, which is why there can be no room for complacency on the part of the banking industry, retailers, law enforcement or indeed customers themselves," Barnard said.
Chip and PIN cards are a major part of credit card fraud reduction in the UK, and most of Europe supports the same technology. According to a recent MSNBC report, financial institutions in Europe still had to accept magnetic stripe cards because some countries, including the U.S., have not switched to EMV technology. However, the European Payments Council recently gave banks permission to deny magnetic stripe cards.