Card Fraud on the Increase

Credit and debit card fraud reached a record high of £535 million last year, according to new figures from the government. The British Crime Survey revealed that criminals are now using new methods to target consumers following the introduction of Chip and Pin.

Skimming, where a card is cloned and then used by thieves, saw a year-on-year increase of 46 per cent. Consumers lost £144 million during 2007 due to skimming, up from £98 million in 2006.

The survey revealed that skimmed cards are used to withdraw cash abroad where ATM machines do not check for the Chip and Pin microchip.

Another new trend noted was the use of bugging devices which can be fitted on to till-side payment systems to record the information stored on the magnetic microchip. By using this method, criminals are also able to record pin codes.

Last year also saw an increase in the fraudulent use of cards at UK tills, with £73 million spent illegally at the nation's checkouts. This is up from £72 million in 2006 which represented a significant fall from £135 million in 2005.

Professor Ross Anderson from Cambridge University told the Daily Mail that Chip and Pin has not had the desired affect on card fraud. He said: "Chip and Pin has not delivered the security that was promised. It has simply led to a change in tactics."