Credit Card Fraud Soars To $131m, Mainly Online

The Age

Tuesday December 16, 2008

By ERIC JOHNSTON

CREDIT card fraud jumped 45 per cent to more than $131 million in 2007-08 with most of the growth coming from suspect online payments.

As more payments move online and offshore, banks and card issuers are struggling to curb the rate of fraud.

Figures released by industry body the Australian Payments Clearing Association show 361,000 fraudulent credit card transactions occurred in the year to June 30. This translates to $50.19 in fraud for every $1000 spent on credit cards, up from $38.62 in the previous year.

The bulk of these were card-not-present transactions - where the card holder and retailer do not meet face to face - such as online or on the phone. Almost $63.5 million in 211,000 transactions was lost in this way, the APCA figures show.

The steep rise in fraud is a major worry for banks and credit card providers, which have been pushing for new security standards in Australia, including the recent introduction of PIN numbers for credit cards for over-the-counter transactions.

However, the crackdown on over-the-counter fraud is believed to have driven most crime to the internet, where transactions are harder to police and fraudsters can remain anonymous.

© 2008 The Age

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