It must have been a slow news day, because the page 1 headline in the Herald Sun made the point that there was some card fraud about. Yes, there is some fraud – almost all of us have suffered it at some point, or at least know someone who has. Do the banks respond well? For the most part, it seems they do. But are the amounts excessive? I guess that’s a matter of judgement, but according to the Reserve Bank (click through from here) the total value of credit and credit charge transactions in May 2017 was about $29 billion (as I read it, that’s just one month, although seemingly for that month it was a bit higher than normal). Hence, in the scheme of things, the banks and other card issuing institutions give the impression of being prepared to pay out when fraud occurs, in that, while the reported $450 million per annum sounds a lot, it’s only a fraction of the amount transacted in this way. The Herald Sun states that fraud is often not reported to the police, and there’s never any feedback to cardholders about things such as “hot spots” for skimming having been detected.
But even so, how does fraud occur? Sure, stolen cards used for “tap-&-go” transactions is one avenue. But cards stolen in the mail? Don’t they have to be activated? And a family member told me that her card had been “skimmed” in a retail store – even though she had retained the card in her sight at all times. So perhaps this still occurs (but surely with some data matching, it would be relatively easy for the institutions to detect where this had occurred). And we still hear occasional reports of ATM machines being set up to “skim” cards, with hidden cameras observing the PIN number.
Then there are people who aren’t quite as careful as might be desired. We had dinner with a former colleague who was quite content to allow the waiter to take his card away from the table in order to process the transaction. So 20th century – but his attitude was, “if there’s a problem, it’s the bank’s worry”.
I accept that the institutions don’t want to compromise their security processes, but for at least some of us, it would be re-assuring to hear what follow up occurs when our card has been compromised.