Credit card customers are at risk from a sophisticated scam that dupes them into handing over their cards and PIN, experts have warned.
The scam has made fraudsters more than £1.5 million in the last two years, but police and the Payments Council are concerned at the speed at which it is growing.
The sophisticated scam works by fooling customers into thinking they are talking with their bank, which convinces people to hand over their PIN.
Fraudsters contact cardholders via their landline, claiming to be from their bank. They tell customers that their credit card or debit card needs replacing as they have been the victim of fraud.
The clever part of the scam is when the victim is urged to hang up and call their bank to ensure the call is genuine. However, the fraudster keeps the line open and plays a recording of a dial tone – duping the victim into thinking they have really called their bank.
Victims are then told to read out their PIN, and a courier is sent to pick up the card. They are told the card is being taken to the bank to be changed, but is actually used to steal as much money as possible from their account.
Victims are even asked to disconnect their phone line, so their credit card company is unable to contact them to ensure the transactions are genuine.
“Many of us feel confident we can spot fraudsters, but this type of crime can be sophisticated and could happen to anyone,” said DCI Paul Barnard, head of the Dedicated Cheque and Plastic Crime Unit, which tackles card and cheque fraud.
Despite credit card users collectively losing only a relatively small amount through this scam – around £1.5 million in total – £750,000 of this has been stolen in the first four months of this year. This is the same amount that was stolen in the whole of 2011.
“If you become a victim of this type of crime, you should contact your bank in the first instance,” added DCI Bernard.
“If you have friends or relatives who you feel may be vulnerable to this, please help them to be more aware of the potential risks and what to look out for. Remember, if you are the innocent victim of card fraud you will not suffer any financial loss.”
If you are concerned about being the victim of credit card fraud, consider investing in a prepaid card. These work in much the same way as credit cards but are not tied to a bank account, making them less vulnerable to fraud.