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An article relating to this blog post on Finextra:

UK card fraud plummets

Fraud losses on UK cards tumbled by more than a quarter - to £440 million - last year, the first fall since 2006, according to figures from the UK Cards Association.


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How Not to Fight Card Fraud

Interesting to read that card fraud has taken a dive - a welcome development I guess for the industry, and for customers, who ultimately bear the cost and, when they are the subject of fraud, the worry and inconvenience whilst their affairs are put right.

Amongst the many weapons that the industry employs is the monitoring programs that try and identify potential fraud from individuals' spending patterns, and the follow-up activity that card issuers employ when suspect traffic has been flagged by the relevant systems.  Like many people, I have received phone calls from card issues in the past checking up on what they identified as potentially dodgy activity - like a reasonable-sized purchase in a jeweller's, for instance.  Quite apart from the obvious benefits in terms of reducing fraud losses, these phone calls give cardholders the reassurance that there are processes in place for protecting their accounts (they do it for me anyway).

Last week, however, I had an experience that was much less satisfactory.  Having made an internet purchase from a US organisation, we started getting phone calls at home.  When we picked the phone up, rather than getting a real-life person on the call, there was an automated message telling us this was a fraud check and asking us to press '1'.  Of course, we didn't comply and, over the course of the next 48 hours, we must have received getting on form a dozen such calls, none of which we progressed, as we thought it could be a scam.

From what I understand (I didn't answer all the calls) the 'caller' claimed to be my card issuer.  Interestingly, the calls stopped after I used my card at a POS, which required me to input my PIN.  Of course, this could have been a coincidence, but I'm not so sure.

My point is that, with so much telephone phishing going on, and the fact that there have been phone scams that, when you start presing buttons, you end up spending lots of phone call time, if the calls really were from my card issuer and they have now resorted to automated dialling, and voice/touchpad response, they haven't thought through the way many people would react to such a call.  There is no way that I, or many other people, would answer a call like that and, if it is a money-saving device, it is probably a false economy.

Has anyone else had such an experience, or am I becoming paranoid?

Comments: (1)

Matt Scott
Matt Scott - RenovITe Technologies Inc - London 16 March, 2010, 14:05Be the first to give this comment the thumbs up 0 likes

Some UK Banks have deployed automated outbound IVR Dialer systems to verify transactions over a 48h period when their Fraud Detection Application has flagged possible Fraud on your Card.

Initially the call asks to confirm you are the Cardholder, then verifies this using multiple choice years, months and dates of your birth.

I don't recall them asking for my PIN - they may have asked for your Telephone and Internet Banking PIN - which (for security best practice reasons) should not be the same as the PIN for your Card.

The Call will then outline 5 of the last transactions over the last 48 hours, you will be asked to confirm these as valid transactions or mark them as potential fraud.  If you confirm all 5 transactions are valid the IVR System will ask you if you need to use your Card immediately - if you say yes the Card will immediately be unblocked.

If you have said any of the 5 last transactions were potential fraud cases the IVR will reroute your call to a Fraud Team member in a Call Center.

 

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