Fraud losses on UK cards decreased by 9% in the first half of 2011 compared with the same time last year, according to Financial Fraud Action UK. The fall – the largest of its kind in eleven years – has been credited to the increasing use of fraud detection software and the roll out of updated chip cards.
While such anti-fraud initiatives may appear to be working, there are many in the industry who believe that businesses need to remain vigilant to the threat of card fraud. According to the Crimestoppers Trust, card fraud is one of the ‘biggest worries’ for business owners. It reports that businesses lost £428 million in 2006 through fraud on UK-issued cards.
Banks are currently in the process of strong-arming small businesses into paying a fee to install new anti-card fraud measures. Lloyds TSB, Barclaycard and HSBC will require nearly half a million shop and restaurant owners to pay a fee of approximately £65 to have their IT systems assessed to prove they are adhering to contract rules set by MasterCard and Visa.
Bank-imposed requirements aside, there are a number of ways business owners can help in the fight against card fraud. Managers should strictly control who has access to any equipment, documents and computers used in financial transactions. All staff should be trained to adhere to security systems and be aware of any disciplinary procedures resulting from an infringement.
Wherever possible, duties should be divided between members of staff so that irregularities are more easily noticed. The Crimestoppers Trust suggests that, “random spot checks are effective at preventing fraud”.
Staff members should adopt the habit of routinely checking the dates that debit and credit cards are valid from and to. They should also inspect the card and signature strip for signs that they have been tampered with. The number on the card must match the number on the till printout.