Following our recent article on consumers becoming increasingly conscious of eCommerce fraud, online shopping has in fact reached its lowest level for more than five years, according to figures presented last week by Financial Fraud Action UK.
During the first six months of this year, fraud in the so-called card-not-present transactions, which include online shopping, e-mail and phone order, dropped by 8%, compared to the same period last year, reaching GBP109.2m. The fraud rates have been going down steadily since 2008, when fraud was estimated to have brought losses of nearly GBP164m.
Overall, card fraud in the first half of 2011 in the UK declined by 4% over the past 12 months, standing at nearly GBP130m.
The positive development in fraud rates can be attributed to various steps, such as growing use of data protection measures in accordance with the Payment Card Industry Data Security Standard and the implementation of online screening practices like Verified by Visa and MasterCard SecureCode.
However, despite the tighter security, fraud arising from lost or stolen cards has risen by one-fifth and from cards missing in the mail by over 40%.
Nevertheless, DCI Paul Barnard, who is in charge of the special police unit dealing with fraud, the Dedicated Cheque and Plastic Crime Unit (DCPCU), commented that the falling rates of fraud were encouraging. He also warned that criminals tended to use old-fashioned methods recently, like distraction techniques and phone banking details.
This is all good news for retailers, who are forecasting this Christmas to be the busiest year for online sales to date, despite the impending economic gloom publicised in the media.