My turn for card fraud

Only when the bank statement arrived did Nic Cicutti realise he was a victim of plastic theft
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The Independent Online
I have written about it before, of course; even sympathised with some of the victims of plastic-card fraud whose stories have featured in these pages. Last Friday it was my turn. Enterprising fraudsters had obtained my card details from one of the many routine transactions of the previous few weeks. They either "swiped" my card through a rogue electronic machine, reading and recording the card's magnetic strip or - more likely - they simply noted down its 16-digit number and expiry date. Shortly afterwards my alter ego(s) went on a spree. Within the space of a few days, they managed to buy pounds 2,000-worth of goods from a range of mail-order catalogues, mostly from just one: Next Directory. The goods ordered were presumably sent by next-day delivery to a convenience address. The fraud came to light only when my bank statement dropped on the doormat, telling me that my spending had seemingly soared out of control.

According to the Association for Payment Clearing Services (Apacs), "my" fraud is one of thousands perpetrated each year by credit and debit card fraudsters. Richard Tyson-Davies, an Apacs spokesman, says that some pounds 97m was taken fraudulently in 1996, up from pounds 83m in 1995. Apacs points out that usage of plastic cards has more than doubled in the past six or seven years, while fraud has almost halved over the same period. However, over the same period there has been a marked increase in the more sophisticated end of card fraud, with counterfeit card use rising from pounds 7.7m to pounds 13m in the past year alone. Fraud where a card need not be presented at purchase, such as with telephone orders, rose from pounds 4.6m to pounds 6.5m, while overseas- related fraud was up 18 per cent to pounds 25.4m.

The increase is caused partly by the increased ability of issuers to prevent fraud, by devising more secure methods to send new cards to their customers, for example.

This still leaves the development of counterfeit cards, using technology which can replicate almost exactly the look of a card, down to the magnetic strip which contains a customer's details. The information is taken by double-swiping a card and putting the details on a new one, which may itself be stolen.

The tendency towards counterfeiting has led to ever-increasing research in the technology used to combat it, including microchips, photos and various electronic fingerprints.

The second reason for the growth in fraud cases is the ease with which it is possible to order goods or services simply by giving one's card details to the supplier over the phone. The information needed to do this becomes available every time we use a card to pay for a meal in a restaurant: it is virtually unheard of for a waiter not to take away the card from a table when the bill is being paid.

David Underwood, who is in charge of card services for Lloyds/TSB Group, sympathises with those who say that asking for vigilance from customers in these cases is to ask the impossible. "There is a practical difficulty with the guidelines we give, particularly in restaurants and wine bars where they ask you to leave the card behind the bar." he says. "What we still try to encourage is to avoid that practice and also to destroy carefully any slips with card details on. Basically, people should be treating their cards as if they were cash - which means never leaving them unattended, whether in a jacket, a car or a bag."

Barclays Bank has a list of dos and don'ts for card users:

Never keep a chequebook and card together.

Never write down your Personal Identification (PIN) number.

If you think your card is lost or stolen, report immediately. Keep the card number and the phone number of your issuer handy.

Check your statement carefully and query unknown purchases.

When abroad, do not let the card out of sight. If need be, ask the waiter to bring the imprinter to you, or go with him to the till.

Always check card vouchers carefully and never sign an open one, except in the case of car hire or some hotels where the card is used as a guarantee of payment. Some fraud prevention experts warn against even doing that.

If you take reasonable precautions - as I did - to ensure that the card was not out of your sight (fat lot of good that did me!), you should not be liable for losses incurred on it. It may not be much, but it's better than paying off a large bill for mail-order goods you will never see or usen Nic Cicutti is personal finance editor of 'The Independent'.

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