Payment Fraud: What Are Your Rights?

New technology and fraud

Online banking fraud has been on the increase. UK consumers lost £609m to card fraud in 2008, a 14% rise on 2007 figures. The modus operandi of the fraudsters has been to deceive people to get their bank account details using fake e-mails or a software that tracks passwords and credit card numbers. Phone, internet and email orders are the main tools of the fraudsters.

Innovations in technology do not automatically lead to an increase in fraud as some have asserted. Rather, fraudsters are usually quicker to adjust to changing systems than consumers.

New card technology such as Emue card is the latest security enhanced card and likely to become much more common in the next few years.

Some guidelines for avoiding card fraud?

Some basic advice recently issued by Apacs include:

* Ensuring that no one sees your card details

* Avoiding writing down your passwords, login details or Pins or disclosing them to unfamiliar sources especially via emails

* Ensuring that you always access internet banking or shopping sites by typing the address into the browser

* Avoiding entering personal details on a website address you have received from an e-mail

* And making sure to check that the security symbol (a locked padlock or an unbroken key) is showing in your browser window when you visit any shopping website.

* Always logging out after shopping and save the confirmation e-mail as a record of your purchase.

* Shredding financial documents that are no longer needed, and locking away the essential ones

* Always notify the bank and those who possess your personal information of a change of address.

* Keep monitoring regularly your credit file for any unauthorized entries.

What to do if you are a victim of card fraud

Anyone who falls victim to card or online banking fraud in England, Wales and Northern Ireland are no longer required to report the fraud to the police and the bank or credit card company. Victims will now only deal with their financial institutions. You should check with your financial institution to identify the phone number to contact and what to do if you suspect fraud. For example, if your credit card is with MBNA and you suspect fraud you should phone +44 1244 672 111 and read their Reporting Fraud page.

Financial compensations for losses

The Banking code stipulates that as long as the victim has not acted fraudulently himself or acted without "reasonable care", they will be reimbursed if defrauded.

If the card has been used before report is made of the theft is made, the card owner would have to pay the first £50 of the amount stolen. The first £50,000 of savings is protected if a bank or building society goes bust.

David Swan
http://www.thinkingmoney.org/
david.u.swan@gmail.com