Payment card fraud rises 24% to €25m

The scale of bank card fraud is continuing to rise, with €25.7m being scammed by criminals off unsuspecting card holders last year.

Figures published by the Irish Payment Services Organisation show the gross value of payment card fraud in Ireland soared by more than 24% in 2011.

The sharp rise was largely attributable to the value of debit card fraud, which more than doubled last year to €9.4m. Credit card fraud accounted for €14.3m of all fraudulent transactions, while €2m was lost through criminal use of ATM cards.

However, the vast majority of consumers did not suffer an actual loss as card-issuing banks absorbed €10.4m of the total amount involved in fraudulent transactions.

The remaining €15.4m was charged back to retailers and banks, most of whom are based outside Ireland, who facilitated the fraudulent use of credit, debit, and ATM cards.

The biggest problem with payment card fraud remains transactions without the card present — namely, the use of a card either online or over the phone. It accounts for 89% of all credit card fraud and 71% of bogus card uses.

IPSO said the trend mirrored credit card fraud in most European countries. However, it said fraud accounted for just 0.1% of the value of all credit and debit card transactions in Ireland last year.

A total of €23.6bn was spent last year by holders of the 5.9 million credit and debit cards issued in Ireland — an increase of 66% in the space of five years.

Almost half of all credit card fraud involving Irish card holders was transacted in the UK, followed by the US (18%). Just 12% occurred within Ireland.

The problem of counterfeit cards and skimming declined last year with such fraudulent use now accounting for 8% of all bogus credit card transactions — down from 11% in 2010.

Una Dillon, head ofIPSO card services, said that while chip and pin had been hugely successful in cutting the volume of counterfeit fraud, criminals remained active in the fraudulent use of cards online.

Ms Dillon said IPSO was continuing to work with retail banks and the Garda Bureau of Fraud Investigation to tackle the problem of payment card crime.

She claimed the industry was continuing to produce solutions such as 3D Secure and Card Security Code, which are being used in the Republic at a growing rate by e-commerce retailers anxious to reduce their exposure to online fraud.

IPSO advised consumers to regularly check their bank statements and accounts for any unauthorised transactions and to report any unusual activity immediately to their card issuer.

Commenting on the IPSO figures, Retail Ireland said they showed card fraud remained a serious problem.

It called on the Government to ensure there was greater enforcement and detection of such activity with greater punishments for anyone involved in card fraud.

“Fraud and retail crimes are not victimless,” said Retail Ireland chairman, Frank Gleeson. “They cost jobs, deprive the Exchequer of much-needed funds and help support the dangerous activities of violent criminals.”

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