Fraud on credit and debit cards rose by a quarter last year to reach a record high despite the introduction of the "chip and pin" security system.
The cost of fraud on cards issued in Britain totalled £535.2 million during 2007, with losses rising for the first time since 2004, according to the payments body Apacs.
The group said the rise was largely driven by a 77 per cent jump in fraud carried out abroad, with criminals using stolen British card details overseas, typically in countries that have not yet upgraded to chip and pin.
Overseas card fraud was worth £207.6 million, or 39 per cent of the total lost.
But there was also a six per cent increase in card fraud losses in Britain, which was largely driven by fraudsters using stolen details to make purchases over the telephone or internet, or by mail order.
This "card not present" fraud soared by 37 per cent to £290.5 million, possibly as criminals frustrated by chip and pin security looked for alternative scams.
Chip and pin does seem to have had an impact - fraudulent use of credit and debit cards on the high street has dropped by two thirds in the past three years, from £218.8 million in 2004 to £73 million last year.
There was, however, a 46 per cent rise in fraud using cloned cards, although most of this was thought to have happened overseas.
[Source: http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2008/03/12/nfraud112.xml]
