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Don’t be a victim of banking fraud

Don’t be a victim of banking fraud

Category: Banking

Updated: 18/03/2014
First Published: 18/03/2014

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Shielding your PIN as you get cash out the ATM is a banking skill we've all been practising for years, but as technology improves so do the skills of fraudsters, and we need to be aware to keep one step ahead of them.

Card and online banking fraud has seen a frightening rise over the past year totalling £450.4 million in 2013, showing a 16% rise on a year before, according to The UK Cards Association.

Banks and larger retailers are constantly trying to improve fraud detection and prevention systems and it is clear this is having a positive effect with overall fraud losses on cards down 26% since its peak in 2008. But as criminals come up against systems such as Chip & Pin and real-time fraud screening, it seems they are also adapting with the times and increasingly appear to be targeting individual consumers and smaller businesses.

Distraction theft in shops and bars is a common way for criminals to get hold of credit or debit cards, as is "shoulder surfing" at ATMs to get a glimpse of people's personal details. Losses due to fraud on lost or stolen cards have increased by 7% since last year and currently stand at a staggering £58.9 million.

Fraudsters also use a lot of tricking and duping tactics to fool vulnerable people into handing over personal details. Often posing to be someone else, whether turning up at your door or through a method called "vishing" where criminals trick consumers into parting with personal details over the telephone, deception is a major form of fraud. Vishing was the driver for a 14% rise in card ID theft last year, showing a rise of £36.7 million.

Remote card fraud, that of online, telephone and mail order, increased by 22% last year to £301.1 million, with digital hacking through malware – people unknowingly downloading software enabling hackers to get their hands on details from your computer – a common problem.

Online and telephone banking is another area exploited by criminals, and banks and building societies are always trying to come up with sophisticated security systems to beat the fraudsters. However, it seems the criminals are still getting the better deal when it comes to online banking as this kind of fraud increased by 3% last year to £40.9 million with business accounts often being targeted for higher returns. Happily telephone banking fraud has actually fallen by 8% to £11.6 million thanks to tighter processes by banks to confirm the customer's identity.

Cheque fraud also saw a decrease of 22% last year to £27.5 million due to improved fraud detection methods, including the digital analysis of cheques.

Detective Chief Inspector Perry Stokes, head of the dedicated cheque and plastic crime unit, said: "Whether in the real world or online, these latest fraud figures show just how important it is for consumers and businesses to know how to protect themselves against fraud. Always make sure you have the latest security software installed on your computer, so you can safely shop and bank online.

"Fraudsters can be extremely persuasive – do not be fooled. Your bank or the police will never call, visit or email you to request your PIN, collect your bank card, or ask you to transfer money to another account. Anyone attempting to do so is a fraudster."

Here are some tips to ensure you're not a victim of fraud:

  1. Keep your operating system and your security and anti-virus software up-to-date on your computer and make use of the bank's own free security software.
  2. Only shop on secure websites and make sure the locked padlock or unbroken key symbol is showing in your browser.
  3. If you receive an unsolicited email from your bank or an organisation such as HMRC, be cautious - don't click on any links and remember your bank will never ask for any of your details by email. Always open a website, such as banking, in a new browser and not from a link.
  4. Bank and police will never phone or email customers asking for their PIN or full online banking codes and they certainly won't visit your home to collect a bank card.
  5. Protect your PIN. Make sure you are the only person who knows it and shield yourself when keying it in anywhere.
  6. Use a strong password when banking online and by telephone. Use a mixture of letters and numbers as well as upper and lowercase letters and don't use anything too obvious like your favourite colour or common pet name.
  7. Keep a regular check on bank statements for any suspicious transactions and let your bank know immediately if you spot anything. After checking your statements, be sure to shred them, or opt for paperless statements.
  8. When writing a cheque, draw a line through the unused space on the payee line to prevent any fraudulent alterations.

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