Card Fraud Alert has been launched by CPP Group Plc (CPP) to combat the crime of card-not-present (CNP) fraud.
The innovative new product, developed by CPP in conjunction with fraud specialists The 3rd Man, was designed in response to the growing threat of CNP (1) fraud. It proactively monitors online transactions by cardholders, and continually scans approximately 20,000 of the most popular websites to alert consumers to suspected fraudulent transactions.
Cardholders subscribed to Card Fraud Alert will be sent an SMS if there is potential fraud on their account, and provided with access to a 24-hour fraud expert helpline. If a customer confirms that they have not authorised the suspect transaction, CPP will instantly inform the bank and the customer has the option of cancelling their card. The affected retailer will also be notified.
Card Fraud Alert is distinguishable from the banking sector's current fraud detection systems, as it is the only product on the market to identify potential fraud and reduce the risk of fraudulent activity. It continuously monitors transactions, analysing data that is not always available to banks. Using the Internet Protocol (IP) address, it can also identify where purchases have been made compared to delivery addresses, to track down fraudsters.
The threat of CNP fraud has risen since the introduction of Chip and PIN in 2006. From 2007 to 2008, there was a rise in CNP fraud of 13 per cent, totalling over £328m and accounting for over 50% of total card fraud reported (2). In addition, over 700,000 fraudulent online transactions have been recorded by UK online retailers in 2009 to date, totalling over £135.6m (3).
Simon Bradley, Product Manager of Card Fraud Alert, said: "The dramatic rise in CNP fraud, over the phone, internet and mail order is unfortunately making many consumers wary of using the Internet, in particular, to make purchases. Because retailers aren't able to check the card's physical security measures, such as holograms or signature, plus the absence of Chip and Pin verification, mamake this form of fraud harder to tackle. To combat CNP fraud and to give our customers the confidence to shop securely online, we are pleased to launch our Card Fraud Alert product.
"Through continuous monitoring, combined with SMS fraud alerts and a 24 hour helpline for cardholders, the service is innovative within the market and will help banks and customers remain at the forefront of fraud detection.
"The launch of Card Fraud Alert complements CPP's suite of other life assistance products for consumers, which includes Card Protection, Identity Protection and Phonesafe Insurance."
(1) Cardholder-not-present (CNP) transactions happen when neither the card nor the cardholder are present at the point-of-sale, driven by online, mail order and telephone fraud
(2) According to APACS figures for CNP fraud 2007-8:
(3) According to statistics from The 3rd Man