Fraud on Australian payment cards exploded by 25% in one year and almost all was card-not-present (CNP) fraud which jumped 42%, according to the latest figures.
A recent Australian Payments Clearing Association (APCA) report reveals that fraud on Australian payment cards continues to blow out online reflecting a worldwide trend towards increasing cybercrime risk.
Results from the Australia Payments Fraud–Details and Data 2015 show that in 2014 the rate of fraud on domestic payment cards increased to 59c in every $1000 spent which is up from 47c in 2013. Almost all (94%) of this was CNP fraud such as online, phone or mail.
The key findings were:
- CNP fraud increased by 42% to $299.5 million (up from $210.4 million in 2013).
- Two-thirds ($200.6 million) of CNP fraud occurred overseas (from $124.5 million in 2013).
- CNP made up 77% of all payments card fraud by value (compared to 52% in 2009).
APCA explains the increase in CNP fraud this way:
- Increased popularity of online spending by Aussies. According to an RBA study, CNP activity accounts for about 40% of the total value of credit card purchases and almost 25% of debit card purchases.
- Fraud targets the most vulnerable segment. Because the more-secure chip technology has become more widely used, criminals will try other types of fraud which are easier to do.
- The types of fraud are ever growing. With the increased threat from cyber criminals experienced by governments, businesses and individuals worldwide, CNP fraud is just one part. See the Tyro Fraud Checklist for the types relating to your business.
In the report, APCA outlined the ways business were handling fraud prevention such as the “tokenisation” initiative and current measures such as enforcing standards to protect card data, stronger cardholder authentication techniques and enhancing real-time fraud detection tools.
The jump is backed up by a recent report from the Australian Cyber Security Centre. Its recent Threat Report 2015, which outlines how businesses only have to be connected to the internet to be vulnerable, makes for scary reading.
The recent Australian Competition and Consumer Commission’s (ACCC) Targeting Scams survey stated that 91,637 scam-related complaints were received in 2014. This is just the tip of the iceberg with bodies such as the Australian Cybercrime Online Reporting Network (ACORN) and law enforcement bodies saying these figures are conservative.
For more information, read our Fraud Checklist on our Fraud Prevention section. If you are a Tyro customer and you suspect a transaction is fraudulent, call our Fraud Analysis Team immediately on 02 8907 1610.