Recent figures from the UK payments association APACS (Association for Payment Clearing Services) show that card-not-present fraud is on the increase since the introduction of Chip and PIN. These transactions take place over the Internet, by telephone or via mail order purchases and NTA Monitor is warning online retailers to tighten their security policies to prevent this type of credit card fraud.
In 2005, card-not-present fraud rose by 21% to Ј183.2m from Ј150.8m in 2004 and the trend is likely to continue unless online retailers tighten up their procedures.
Roy Hills, Technical Director at NTA Monitor, warns: “Online retailers need to implement tighter security policies to prevent the increase of card-not-present fraud or the general public will lose faith in purchasing over the Internet. It´s just a question of companies taking some easy precautions and having a clear security policy which is adhered to – but many online retailers are still leaving themselves and their customers exposed.”
The latest figures from Apacs show that with the introduction of Chip and PIN making stolen cards harder to use, card-not-present scams are now the easier hit for fraudsters and this type of fraud is on the increase.
Hills continues: “Unfortunately, many websites do not carry out adequate security checks – I´ve lost count of the number of online sites that don´t bother to send a notification to my billing address if I get an order delivered elsewhere.”
Many more online retailers are now taking precautions against hackers sniffing credit card details in transit, but do not adequately protect themselves from cloned or stolen cards being used. For the current trend of growth in sales over the Internet to continue, it is vital that every precaution is now taken by retailers utilising card-not-present transactions, or the general public will no longer trust the Internet when purchasing goods.