Types of Card-Present fraud
Intercept/mail non-receipt fraud
This occurs when a cardholder’s new or replacement card is stolen before it gets to them. Properties with communal letterboxes, such as flats or student halls, are vulnerable to this type of fraud. With contactless technology becoming more and more a part of everyday life, there has been a growing trend in this type of fraud with the increase of upgraded cards going through the mail.
We work with the Royal Mail to monitor card losses, identify fraud hot spots and take preventative action. Card Companies use secure couriers to deliver to high-risk areas and may require customers to phone them to activate their cards before they can be used.
The magnetic stripe of a genuine card holds all the information a fraudster needs to create an effective copy. How the information is compromised can vary but it usually occurs during a legitimate transaction, including ATMs.
Skimming or cloning can occur when:
there’s a dishonest employee working for a legitimate merchant
small electronic devices (such as a skimmer) swipe and store hundreds of victims’ credit card numbers
the person doing the skimming in, say, a restaurant or bar, has possession of the victim’s card out of their immediate view
We work closely with our retail customers to help them improve their security and minimise the opportunities for card details to be copied. This, along with the rise in security measures such as chip and PIN technology, has helped reduce skimming and cloning fraud by nearly 80%1 in the past three years.
Lost or stolen
No matter how careful your customers are, cards are inevitably lost or stolen. Fraudsters then use them either in shops that don’t have chip and PIN, or to commit fraudulent transactions over the phone, by mail or online.
We use a number of initiatives to fight this type of fraud, including chip and PIN and tracking unusual customer spending. We also give retailers access to the Industry Hot Card File (IHCF), which lets them check whether a card has been reported lost or stolen.