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Chip-and-pin cards were supposed to combat growing levels of plastic fraud. By giving everyone a four-digit number, and embedding customer information on a chip, the process of paying by card was meant to be more secure.
Unfortunately, gangs of criminals seem to be able to crack new technologies almost as soon as they're invented. The newest scam involves gangs attaching 'cloning devices' to chip-and-pin payment terminals in petrol stations. These gadgets read the information on a card's magnetic strip and capture the pin number. With this data, new cards can be rapidly produced.
To reduce your own risk, steer clear of obvious no-nos like letting a card out of your sight in a shop or restaurant. And you should still be aware of tactics that now seem old-fashioned like 'shoulder surfing', where criminals memorise a pin
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number as it's keyed in and then find a way (through distraction or violence) to steal the card.
It's true that chip and pin has reduced card fraud in some areas, but that just means the criminals exploit a loohole elsewhere. The big growth market is now 'card not present' fraud, in other words online and phone transactions where pin numbers aren't needed. To protect yourself, pay using a secure website and beware fraudulent 'phishing' sites, which mimic legitimate banking and e-commerce sites in order to extract bank and credit card details from gullible customers.
Cash, of course, is the most reliable way of beating fraud. But then you have to go to the hole in the wall...
Information on fraud prevention at www.cifas.org.uk 
FIRST POSTED MAY 11, 2006
 Last week: losers and savers |
