This year an estimated R420-million will be lost due to credit card fraud — a 59,8% increase year on year. Preventative measures by banks stopped a further R573-million but we remain our own worst enemies.
With banking systems and tracking technology becoming more sophisticated, criminals are now conning people to hand over their card details. This is evidenced in the doubling of counterfeit card fraud in the past year, while false application fraud has fallen dramatically as banks tighten up their application systems.
Criminals rely on our laissez-faire attitude such as allowing our bank cards to be out of sight and handing over sensitive information. If we had been more streetwise this year, we could have kept at least R150-million from getting into criminal hands.
These guys are getting more clever and organised. Most of the skimming (card copying) is done at busy entertainment areas such as restaurants or bars.
Waiters carry the tiny device in their aprons or pockets and take a couple of seconds to skim your card while it is out of sight.
As consumer activity increases in these areas over the festive season, the banks are expecting an upsurge in credit card fraud in December.
But cards are also being skimmed at ATMs. The South African Banking Risk Information Centre (Sabric) has video footage of a woman drawing money from an ATM. Through tactics that included a slip of paper supposedly issued by the ATM, the woman was told that her transaction was not successful and she needed to put her card back in the machine. Two conmen worked together using sleight of hand to take her card, skim it in a portable card-reading device and give it back to her.
Even if she was suspicious about their assistance she would have been assured by the fact that the card she put back in her purse was hers. So she did not report the incident until she realised that money was being taken from her account several days later.
Susan Coetzee of Sabric says often criminals will dress in T-shirts with the bank’s logo and “assist” people at the ATM. Another trick is that if the target becomes suspicious, another conman will pretend to dial the bank’s hotline from his cellphone and hand it over to the customer to cancel the card. Of course the person on the other end of the line is not the fraud division.
Although counterfeit cards (cards produced from card data stolen from a valid card through skimming) accounts for the highest fraud losses (R118-million), “account take-over” fraud has increased by 200%.
This is where account holders are duped into handing over personal information so that the criminal can access their bank accounts. It is concerning that, despite a heightened awareness around access to information, people are falling for these scams such as phone calls, SMSes and emails asking for your banking details.
Sabric says criminals are also using pay-slips, municipal accounts, and cheque books to take over accounts so it is becoming increasingly important to protect your personal papers or destroy them rather than drop them in the bin.
How to keep your card safe