According to the latest banking industry card crime statistics released by the South African Banking Risk Information Centre (SABRIC), debit card fraud losses have decreased by 42 per cent for the period January 1 to September 30, 2013.
This figure is significantly lower when compared to the previous year (2012) which saw the industry loosing R204 million to debit card fraud. In 2013, the debit card gross fraud losses amounted to R117,7 million. SABRIC CEO, Kalyani Pillay, says this was due to the ongoing collaborative efforts between the industry and law enforcement.
However, the banking industry still calls on customers to be vigilant when transacting. The industry is concerned about the increase in credit card fraud with losses that have increased by 22 per cent from R300,6 million in 2012 to R366,8 million in 2013. Card-not-present fraud (CNP), which is a major loss category, increased by 16 per cent during the same period, from R154,76 million in 2012 to R178,7 million in 2013.
The statistics have indicated that most credit card fraud losses occurred outside the borders of South Africa for the period under review. In 2012, 45 per cent of credit card fraud losses occurred outside the borders of South Africa. This figure has increased to 60 per cent for the period under review.
Credit card fraud losses on South African-issued credit cards used inside South Africa, decreased by 11,45 per cent in 2013. Counterfeit card fraud remains high. “Criminals are progressively using counterfeit South African-issued credit cards in neighbouring countries such as Namibia, Botswana and Mozambique and these transactions are mostly related to fraudulent cash withdrawals at ATMs,” said Pillay.
When it comes to international trends, South Africa mirrors the United Kingdom in terms of card fraud with increases in CNP, counterfeit and lost and/or stolen card fraud. The prevalence of card skimming incidents in South Africa is still very high and a significant portion of the fraud losses can be linked to counterfeit card fraud.
In the UK, criminals are now reverting back to more basic frauds and PINs through shoulder surfing and card swapping at ATMs similar to the modus operandi seen in South Africa. SABRIC is a non-profit company formed by South African banks to support the banking industry in the combating of crime.
Its principle business is to detect, prevent and reduce organised crime in the banking industry through effective public private partnerships. SABRIC coordinates interbank activities aimed at addressing organised bank-related commercial and violent crime, and acts as a nodal point between the banking industry and others in respect of issues relating to crime.
The creation of public awareness of various bank-related crimes and educating the public on how to protect themselves, is one of SABRIC’s key focus areas. SABRIC has identified card skimming as one of the threats in the card-fraud environment which has contributed enormously to counterfeit card fraud.
According to Nedbank in order to mitigate the risk of theft, the bank is migrating all its cards to CHIP and PIN technology. In South Africa, all merchants’ point of sale (POS) devices are capable of accepting CHIP and PIN cards. “By memorising the PIN and not writing it down or telling others, our cardholders can help prevent fraudulent transactions.”
According to Nedbank the simplest way to protect your PIN from prying eyes is to place your unused hand over the hand entering the PIN on the POS pin pad. “If there are unusual transactions on your account advise your bank immediately by visiting your nearest branch or phoning the call centre.
Remember there are time limits to report these transactions,” they said. The bank called upon clients to always check their statements upon receipt and report unusual transactions immediately. “All fraud has to be reported to the card issuer, which, in South Africa, is typically the banks.
In need, the cases must also be reported to the nearest police station. The theft of a credit card can happen anywhere, such as home burglaries, car break-ins and card swapping at ATMS,” they said. “While the card is in possession of our cardholders, we request them to exercise care and to ensure that they get their cards back after every transaction.
Do not accept help from strangers at ATMS. In need, go into the branch and ask for assistance. If your card is retained for any reason at an ATM, always phone our call centre and block the cards.”
