Online fraud losses increase 55 per cent

Figures released today by UK payments association Apacs show that online bank fraud losses rose by 55 per cent from £14.5m in the first six months of 2005 to £22.5m in the same period this year.

These losses primarily involve phishing scams - typically where customers receive an email that seems to come from their genuine bank but is in fact from fraudsters who try to dupe them into disclosing personal banking security information.

Home Office Minister Vernon Coaker said: 'Fraud is not something that can be tackled in isolation - the best results can only be obtained by working together. The Government takes fraud very seriously whether the victim is a multi-million pound organisation or a single individual.'

The figures show that card fraud fell by 5 per cent during this period, from £219.5m to £209.3m, mainly thanks to chip-and-PIN.

A spokesman for Apacs said: 'These latest fraud figures show that the industry’s efforts are making their mark. However, each and everyone of us can also help defeat the fraudsters, and protect our cards and online accounts, by keeping our PINs, passwords and personal information safe and secure.'

Apacs is also liaising with banks, card schemes, retailers and systems vendors on an authentication system for potential use in both online and telephone shopping scenarios, and is working towards a trial in 2007. The system would work via a cardholder inserting their chip and PIN card into a hand-held card reader, and entering their PIN.

Apacs says there are several straightforward steps consumers can take to protect themselves against online banking fraud, such as being wary of unsolicited emails requesting personal information, and installing up-to-date anti-virus software and a personal firewall.

What do you think? Email us at feedback@computing.co.uk

Further Reading:

Banks seek new fraud solutions

Banking body upgrades identity management systems

Barclays to tighten web security