Community

Now I'm not clairvoyant, but warning signs pointing to increased fraud losses were buried in last year's results, despite them being the lowest figures in the last five years: £341m. Specifically, there were two exceptions where plastic fraud increased (mail inception and lost and stolen).

This was a clear signal that the fraudsters were returning back to low-tech methods. Let's not beat up chip and pin here - it's had success. We too readily forget that had we not adopted it, extrapolated losses were expected to rise upwards of £840m. However, let me continue with the low-tech theme for now.

Counterfeit cheques also showed evidence of increased losses – again the jump from counterfeit cards and cash to cheque should not have been a surprise. Social engineering is a big menace and we should recognise the efforts of industry, trade bodies and government to educate the customer to be wise to the threats. Ignorance is a real problem and I think the case for contributory negligence against the customer continues to build.

One last thought. I'm just puzzled as to whether all banks are equally impacted or whether we have a few non-performers who might be distorting the statistics. That's something the trade bodies, regulators and shareholders probably need to contemplate. 

A valid and interesting viewpoint.  Perhaps we can carry this discussion on offline.  Please feel free to contact my office – happy to chat further.

Thanks. Putting out a statement that 41% of the fall is attributed to fraudsters impersonating customers is a little ambiguous and misleading from my perspective. Yes fraudsters can use genuine cardholder details to obtain goods or services (impersonation).  However, the reality is here we are measuring and talking about third party fraud - fraud not perpetrated by the cardholder. Yet CIFAS reports cite 18% increases in Account Takeover and 10% rises in Identity theft  - also third party fraud. The CIFAS measurements aren’t necessarily at the payment (Card) level – which is really the point that I was making in respect of comparing apples with apples in my initial blog.  

Finally, not sure I share your views on the first party issue. I think the industry takes the topic very seriously given that it is widely suspected that this type of fraud can also be a vehicle used to finance terrorist activities.