Thousands of people fall victim to card fraud every year. According to Financial Fraud Action, in 2015 alone around £567.5 million was lost to fraudsters in the UK. Bank card fraud takes place when criminals manage to steal your bank cards or account information and then use them to take money from your account, process transactions or take out loans and run up credit in your name.
This is when the fraudster will physically steal the bank card either from their victim’s pocket, purse or wallet. They can then use the card for transactions without their knowledge.
Luckily, most places in Europe require a four-digit PIN number to authorise transactions-however, that doesn’t apply to online purchases. Also, now nearly everybody has a contactless card where a fraudster doesn’t even need the PIN number to use the card in shops. Fortunately, in most places the maximum amount you can spend with a contactless card is around £30 and only around four times a day so there is some sort of limit. Lost or stolen cards can prove very expensive for the victim especially if they don’t notice and don’t report their card as being stolen for a few days.
Skimmer - A ‘skimmer’ device is attached over the card slot of a cash machine and once it’s in place it will record the details from your card’s magnetic strip whilst sometimes using a camera to record the PIN number being entered.
To avoid this, you should first check to make sure there is nothing unusual about the card machine’s appearance- they are normally spray painted to match the colour of the machine. You should also check for any scratches, tape or sticky residue.
Card traps - This works by a device being entered in to the card slot which then retains your card inside the machine, allowing the fraudster to come back later and retrieve the card.
If this happens, you should not assume your card is safe and contact your bank to cancel the card immediately.
Hidden cameras - Fraudsters place hidden cameras either on the cash machine itself or anything seemingly normal (like a nearby leaflet stand). These are then used to capture their victim’s card details and more importantly their PIN number.
To avoid this, you should use your hand to shield your PIN from every angle.
Distraction – This works by fraudsters working together to distract you as you are taking money from a cash machine. One might ‘accidentally’ drop something near your feet whilst the other one takes the card or money from the machine as you’re not looking.
Do not let yourself get distracted and If you notice anyone hovering nearby and acting suspiciously you should choose another machine and report them to the police.
Fraudsters can illegally manufacture fake bank cards encoded with the account information that they have stolen from the magnetic strip of somebody else’s card. The fraudster can then use the card to carry out unauthorised transactions in countries where the chip and PIN system is not supported. They can also use the card for online or telephone transactions.
This type of fraud occurs when a criminal uses a fraudulently gained card or account details, along with stolen personal details to open or take over an account in somebody else’s name. Account Takeover occurs when the fraudster can also use this information to phone their victim’s bank, pose as them and either arrange for funds to be taken out of the account or change the home address to have new bank cards sent to them which are then used fraudulently.
This type of fraud is when the card is stolen in transit- so after the card has been sent from the card company and before the card reaches the rightful cardholder. The PIN number is normally sent with the card itself so if it falls into the wrong hands they have everything they need to start using it for fraudulent transactions. People who live in communal properties, such as flats and student accommodation, and people who do not get their mail redirected when they move to a new house are particularly vulnerable to card non-receipt fraud.
This type of fraud happens when card information is obtained by the criminal through things like bank statements or discarded receipts. This information is then used for fraudulent transactions that don’t require the physical card to be presented, for example online or over the phone. This often remains undetectable until the victim notices payments leaving their account which they didn’t authorise.
|Lost & Stolen||68.5||56.2||54.1||47.9||44.4||50.1||55.2||58.9||59.7||74.1||24%|
|Card ID Theft||31.9||34.1||47.4||38.1||38.1||22.5||32.2||36.7||29.9||38.2||28%|
*All figures in £ millions
Entering your card details into websites online can open you up to wide range of fraud and scams so it is important that you are aware of how to make sure you are using safe and trusted websites.
The easiest way to protect yourself from fraudsters while you are away is to use cash, but understandably not everyone wants to carry a lot of cash around with them on holiday. Your credit or debit card is easy to use on holiday as most are accepted around the world and you can take out cash from ATM machines whilst you are there. So, if this is your preferred choice you should only take one card you want to use and leave the rest at home in a secure place. You should treat it like you would at home by never letting your card leave your sight, protect your PIN and check your bank statements when you get home for anything unusual or suspicious.
However, pre-paid cards are increasing in popularity as you can put a certain amount of money onto the card before you go and then you can spend it however you like when you are there. Also, it is not linked to your bank account so if it was to be lost or stolen you can only ever lose the money that is on the card. The only down side is that you may be charged a fee to withdraw cash from an ATM or if you don’t use the money within a certain time period - but this is a much safer option.
Get more tips on preventing fraud by reading our article about the many holiday scams to whatch out for.
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Last updated: 06 November 2018 | © KIS Finance 2018 |