Credit-card fraudsters target internet

Credit-card fraudsters are increasingly turning to the internet now that the "chip and pin" system has closed other money-making avenues, new figures show.

"Card-not-present" fraud - in which criminals get hold of people's credit and debit card details and use them to buy goods online, over the phone or by mail order - has grown by 29% in a year, says the Association for Payment Clearing Services (Apacs). Online banking fraud has also risen sharply. Apacs is promoting a consumer awareness campaign to inform people of safety precautions they can take when shopping online.

Overall, card fraud losses have fallen. For the six months to June 30 they totalled £219m - down 13% on the £253m of losses recorded during the same period last year.

This has been attributed to the successful introduction of chip-and-pin technology, which involves shoppers typing their four-digit personal identification numbers into keypads at tills instead of signing receipts. Fraud involving criminals trying to use counterfeit, lost and stolen cards to buy goods in shops has fallen sharply as a result because, in most cases, they do not know the authorised pin number.

Many fraudsters now appear to have shifted their attention to the internet. Card-not-present fraud amounted to £90.6m in the first six months of this year, up from £70.2m during the same period in 2004. Internet card fraud made up the lion's share (£58m) of this.

Meanwhile, online banking fraud - involving "phishing" and other scams designed to dupe consumers into disclosing personal security information - more than trebled to £14.5m in the first six months of this year.

A Lloyds TSB spokesman said the figures showed that criminals were getting more cunning. "We have seen a rise in attempts by fraudsters to steal online banking details in ever-more-sophisticated ways," he said. The bank is conducting trials of a keyring-sized device that generates a unique six-digit number that customers enter when they log on.