By Julian Goldsmith, 2 April 2007 13:29
NEWS
Changes to reporting procedures for plastic card fraud have come into effect - but one critic is warning the changes may make things easier for fraudsters.
From now on, card fraud will be reported to banks, which will then choose to forward the report to the authorities if they deem it is necessary.
The Home Office said from 1 April new procedures under the Fraud Act 2006 mean banks and financial institutions become the first point of contact for cheque, plastic card and online fraud offences.
The Home Office said in a statement: "In most cases consumers will be required to report these crimes to their bank or building society directly and not to the police. The financial institution will then pass the details of the relevant crime on to the police."
It said the changes follow discussions with the Association of Chief Police Officers and the financial sector, with the main aim to reduce the level of bureaucracy involved in fraud recording and to streamline reporting and the initial investigation of such crimes.
The new rules cover England, Wales and Northern Ireland.
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But Andrew Goodwill, MD of security company Early Warning, believes this will allow banks to let themselves off the hook and hide the true extent of card fraud suffered by UK card-holders.
Online retailers are especially vulnerable, as banks are not liable for Card Not Present (CNP) fraud and will be less inclined to forward such reports to the police.
He added that bank staff are not trained to take reports in the same way as the police, so vital evidence might be missed, making it harder for fraudsters to be tracked down.
He said: "It's not fair to let banks act as judge and jury for consumers. Fraud is an offence and it should be dealt with by the police. Are we going to get to the situation that if your house is burgled, you have to report it to your insurance company? The police should not be allowed to negate their responsibility for fraud."
Comments
There are 4 comments. Join the discussion
1. Simon the Cynic
This is not about who is best placed to deal with it, it's about silently moving an expenditure from the public sector to the private sector - ie another stealth tax.
The same has happened with Fire Safety. The local Fire Service no longer has responsibility for 'approving' premises - that is now down to the responsible person (owner or occupier) to perform a risk assessment. Result ? Opportunity to reduce staffing levels in the publically funded Fire Service, whilst most people responsible will resort to consultants (private sector) as a CYA excercise.
CYA = Cover Your Backside, as in being able to say <whilst standing in dock after a fire> "but the qualified consultant reviewed it and said it was OK, I am not qualified to disagree with him" !
2. DB
Theres a conspiracy!
Could this be an attempt to manipulate the recorded crime figures?
If the banks don't report the fraud reported by customers, then the recorded crime figures will be lower creating an artificial impression that crime is lower.
Who says the goverment aren't crafty?
3. Bart Patrick
I disagree with the claims that this new approach will give the banks more flexibility in their reporting infrastructure. If anything, it will cause them to have less flexibility as they face this new reporting regime. Strategies in combating card fraud are becoming more defined, with the government setting up a National Fraud Strategic Authority and a National Fraud Reporting Centre will be put in place. With fraud being so high on the agenda, banks will find it difficult to sweep cases under the carpet. The industry needs to proactively refine anti-fraud activities to prevent being swamped with new directives on fighting fraud over the coming years, as this new initiative could be a thin slice of the wedge as government and police ramp up procedures for reporting fraud and fighting terrorism.
4. PG
It probably is an attempt to manipulate the recorded crime figures and gives the police more time to do what they do best - focus on the motorist, an easy target and one that they seem to think is a bottomless pit of funds for the establishment.
BTW - have you ever tried to report a crime - forget it they don't want to know.