Published: 31/01/2011

Owners of credit cards have become more worried about credit card fraud than ever over the past few years. Whether it is from stories in the media regarding people who have had their credit cards used by scammers or anecdotal evidence from friends, it does appear that the problem is getting worse. This may not, though, be the case. A recent report has indicated that the overall number of people who have experienced credit card fraud has dropped in the last year. Could it be that the message is finally getting out about the importance of keeping a close eye on your finances, or have the fraudsters simply moved on to easier targets?

The annual Card Fraud Index from CPP was released recently and it revealed that over the last year, the number of people affected by card fraud has dropped from 10% to 7%. While this figure does seem to be small, it does represent a significant portion of the population who have been safer in 2010 than they were in 2009.

Sarah Blaney, a card fraud expert from CPP, commented in a press release that the reduction is good news and shows how certain schemes such as Verified by Visa and MasterCard Secure Code are helping win the fight against credit card fraud.

Other results from the survey indicate that 38% of people admitted they had been a victim of card fraud at any time in the past. Of these, 33% had no idea it had happened to them. Over a third (34%) were informed by their bank and 6% found out when they realised they had no money in their bank account. A further 6% had their card refused in a shop. The survey also showed that the average amount stolen by a fraudster was £417.

The drop in incidences of card fraud may be partly attributed to the use of chip and pin. The system was introduced a few years ago in a bid to reduce the amount of fraud that took place using stolen cards. However, the CPP results also reveal that 20% of the fraud which did take place occurred after a card was cloned which had been stolen at an ATM or chip and pin machine. Skimming machines which can read the card and steal the pin number are a very common method employed by fraudsters to access card details.

In other cases, cards details are stolen via the Internet. Details of cards can be accessed via online shops. The survey reveals that one in five victims were targeted in this way. In some cases fraudsters are sending out phishing emails which download a small program onto a computer which then searches for bank and card details.

The decline in the overall numbers of people being affected by card fraud could also be down to the fact that many people simply do not have or no longer use their credit cards. Getting a credit card these days can be difficult and the numbers of credit cards with 0% interest are now few and far between. Long gone are the days where it was commonplace to have such a card.

In addition, people are keeping a closer eye on their finances by watching their bank accounts and keeping track of their spending. Having increased access to credit reports is also an important factor when it comes to ensuring you are not a victim of card fraud.

The CPP report has suggested that many credit card users are putting themselves at risk when they use their cards. Almost one in five (18%) admit that they do not check an ATM machine to see if it has been tampered with, while 17% fail to cover their pin number when inputting it. A further 16% admitted that they allow their card to be taken out of sight when they are in shops or restaurants.

As Ms Blaney explained, these practises are putting people at increased risk and they need to remain vigilant. She says that card protection schemes are helpful to ensure that cards are cancelled as soon as possible, leaving less time for fraud to take place. She is hopeful that the amount of credit card fraud which takes place will continue to decrease.

If you have a credit card or just a debit card, you need to take steps to ensure you do not become one of the estimated 13 million victims of card fraud each year. Simple steps such as those mentioned above will help and you will be able to rest easy in the knowledge your money is safe.