Card fraud up and down

The incidence of fraud on bank-issued and charge card scheme payment cards increased slightly in the June 2007 half year but as the average size of each fraud incident was lower the percentage of funds lost to fraud fell.

Fraud appears to remain a trivial issue on most payment instruments, judging by the periodic data from the Australian Payment Clearing Association published yesterday.

The number of fraud transactions on cheques, debit cards and credit cards recorded by APCA increased 19 per cent in the year to June 2007 to 320,000 incidents while the value of fraud fell by 10 per cent to $129 million. The average value of a fraud is $401, down from $531 in the 2006 financial year.

Credit card and charge card fraud accounts for 87 per cent of all incidents. Most high value frauds are cheque frauds, returning the perpetrator about $12,000 each time.

Fraud on payment cards and cheques is equal to around 0.0059 per cent of all payments handled by the four payment streams.

APCA does not yet publish any data on losses from internet banking.

The serious incidence of payment fraud may be occurring within the taxi payments arena. The Financial Review reported today that fraud within the Cabcharge taxi payments systems was running at around $300,000 a month.

This is equal to more than three per cent of the $954 million in Cabcharge payments reported by Cabcharge for the year to June 2007.

The AFR reported most of the fraud related to manual Cabcharge dockets, expired credit cards and abuse of the cardboard eTickets introduced recently by the company.