A big increase in card-not-present fraud and skimming/counterfeiting dominates the latest release of payment fraud statistics from the Australian Payments Clearance Association.
More than one in every ten thousand card transactions was fraudulent in the year to 30 June 2008, representing more than 400,000 criminal acts, up from 320,000 card frauds last year.
There were more than 200,000 card not present frauds committed on Australian issued credit, charge and scheme debit cards during the last financial year. The most spectacular rise was in cross border online card fraud which jumped up 60 per cent over the year to almost 150,000 cases for the year.
Albert Naffah, business development manager in Australia for MasterCard Worldwide says there are three reasons for the big increase in online card fraud.
"Online and particularly cross-border online is a significantly growing area, our fastest growth area of all the segments of card usage," said Naffah.
"Especially with the strong exchange rate we previously had, people were taking advantage of that by purchasing all sorts of goods and services over the internet, so there has been significant growth and of course you are going to see some resulting growth in fraud that goes along with that and that is not entirely unexpected."
Naffah says fraud growth rates actually dropped away significantly in the first half of this year after a big increase in late 2007.
"This set of data captures the remnants of the Roses Only breach; there has been significantly less fraud in the last two quarters of the year compared with the first two quarters.
"The trend since that period has been in decline - we are seeing less fraud lately," said Naffah.
"Australian banks have been investing quite heavily in rolling out EMV for card present and often with fraud when you strengthen one area, the fraud can tend to migrate to other areas.
"But as an industry we now are working on securing the card not present environment."
Naffah says MasterCard wants to improve the levels of usage of the additional security features the schemes have introduced in recent years.
"We have thousands of Australian merchants and cardholders signed up to MasterCard SecureCode [the equivalent of Verified by Visa] and we have the three digit CVC code on the back of the card, so the technology is out there.
"The levels of usage are not as great as we'd like them to be but I think as we move on from EMV we will be looking at educating people about the suite of security products available to them to secure their transactions in the card not present environment."
Last month Visa unveiled a trial by MBNA in the UK of a credit card with a 12-button keypad and LCD display powered by a battery that is said to last three years.
The card holder enters their PIN and is given a security code that is entered into the website. If the code matches with the Visa database the transaction is allowed. A picture and report on the new card is
here.