Deon Louw, head of card and merchant fraud at Nedbank, notes: “Credit card fraud continues to be a challenge not only in South Africa but globally, however, most cardholders are unaware of how to protect themselves against fraud. According to the South African Banking Risk Information Centre, Card Not Present (CNP) fraud is still a major contributor to the overall losses on South African issued cards, according to the current fraud trends. CNP fraud continues to experience an increase and the majority of the card fraud transactions take place at foreign merchants.”
“Customers need to be on their guard. It’s easy to throw away documents containing bank account details or other personal data, not realising the implications of this action, and the long-term costs could be great,” says Nitesh Patel, head of customer financial solutions for personal banking at Standard Bank.
However, with new Chip and PIN (personal identification number) technology on debit and credit cards it assists in protecting people against fraud at any point of sale, according to Henk Vermeulen, FNB fraud specialist. “Your card has got multiple embedded security payment mechanisms that we as a bank drive with the card as well.”
Louw agrees stating: “Whilst counterfeit card fraud still remains problematic, the banking industry is pleased that current information shows a downward trend. This could be attributed to the roll-out of Chip and PIN.”
However, Vermeulen adds that this only works if you keep your PIN private. Furthermore, Louw reveals that stolen card fraud is an increasing threat. This is when a consumer’s bank card is swopped in the vicinity of an ATM. The fraudster will make cash withdrawals soon after the card is taken, before the card holder has time to notice that the card has been stolen and phone the bank to stop the card.
Banks have a number of security measures in place to protect you when using your bank card or making purchases online. Both Visa and MasterCard have embedded payment safety mechanisms to ensure the safety of their customers’ information when making purchases. Vermeulen points out that fraud does not only affect one financial institution, but all of them. “In the industry we strive to work together.”
Tips to protect you against fraud
While you can still be a victim of fraud despite your best intentions, here are some tips from fraud experts to help you better protect your information from scammers.
Absa, FNB and Nedbank emphasise the importance of keeping your PIN safe. This includes not disclosing it to anyone, not evening your partner, spouse or children, not writing it down or storing it in your cell phone.
Furthermore, Absa and FNB advise that people change their PINs regularly, with Vermeulen adding: “You should never use your birth date [or any other significant date], and never use the same PIN for all your cards. You might have different types of cards in your wallet, and it’s easy to use one PIN number [but you shouldn’t], and one should regularly change it.”
Absa notes: “We continue to urge customers to never provide personal banking information to anyone, whether in person or over the phone. Customers must also be wary to never write down their PIN or disclose it to anyone. Customers must also note that in some cases, fraudsters may obtain access credentials long before any attempt is made to defraud the account. It is very important for customers to change their banking information such as the PIN and password regularly to prevent delayed criminal attacks.”
Having notifications that come to your phone whenever you make a purchase or withdrawal is another way to flag any unauthorised activity on your bank card. According to Vermeulen, people can set the limit that they would like to receive notifications for. In other words, if you only want to receive notifications for any activity over R100 on your account, you will not be notified of any purchases or withdrawals that are below R100.
Nedbank and Standard Bank both stress the importance of signing the back of your bank card the moment that you receive it.
Some additional points that Louw suggests people keep in mind to avoid fraud include:
- When paying with a credit card at a restaurant, petrol station or other merchant ensure that the card is not taken out of your sight.
- Scrutinise credit card statements on a regular basis and report suspicious transactions immediately. You should also ensure that all transactions appear on the statement. Bear in mind that due to processing delays, some transactions may only appear on the following month’s statement.
- When disposing of your bank statements or any other financial information, shred the paper to prevent anyone from accessing this information.
- Remember that a credit card is not transferable. Do not lend out a credit card to a spouse, friend or child. They could be arrested for attempting to commit fraud!
- Ensure that your bank has your latest contact details to enable them to contact you should they identify any suspicious activity on your account.
- Always shield the keypad with your unused hand or purse when you type in your PIN. This is the most effective way to prevent onlookers or cameras from viewing your PIN.
Online shopping fraud
Online shopping is becoming an increasingly popular way for people to purchase not only items from overseas and furniture, but also groceries and other household items, as well as clothing that they can have delivered straight to their door or place of work. However, with this increase in popularity, people need to be aware of the risks to their personal information, and how to protect themselves against fraud.
Absa notes that it is important that you are aware who you are giving your credit card information to when making online purchases.
- When shopping online, place orders on a secure website only and never send emails that quote your card number and expiry date.
- Attempt to use sites that are 3D Secure, the cards network trademarks may apply Verified by VISA, MasterCard Secure Code and Safekey by Amex (coming soon).
- Shop from reputable and reliable stores.
- When purchasing at a store you have never used before do a search for any complaints linked to that store, especially complaints regarding the use of credit cards and credit card fraud. When supplying personal information, ensure that these details are submitted using a secure form only. Secure Internet sites are clearly identified.
- Remember to keep a record of purchases.
- After shopping online, check credit card statements and report any transactions that have been made without the cardholder’s knowledge or consent to the card issuer (i.e. your bank).
- Be mindful of shipping costs. These are usually added onto the price of the goods bought.
There are a number of things that a person can look out for to identify an email that may be a phishing scam, rather than a legitimate email from your bank. Absa suggests:
- Look out for emails that are not personally addressed to you (e.g. Dear Valued Customer).
- Never click on a link to access online banking. For example, always go to absa.co.za and then click on the Logon button under Logon to Secure Services. (Nedbank and FNB advise the same, stating that you should never use a bookmarked website page, but rather go to the bank’s internet banking site each time you wish to use it).
- Never enter your PIN or partial password unless you are sure you are on the legitimate Absa.co.za website.
- Don’t respond to suspicious emails, by doing so you simply verify to the fraudsters that your email address is valid and they will target you again.
- When in doubt, delete the email or call your bank for more information.
In addition to these safety tips, Vermeulen highlights that when accessing web pages, whether for online purchases, visiting a website or if you are following a link from an email, there are certain things that you should look out for to ensure that the page you are on is secure.
These include an ‘s’ included in the ‘https’ that appears at the front of the website URL. This ‘s’ indicates that it is a secure website. You must also look for the padlock symbol which will appear near the URL. If the padlock is locked, that is also indicative that the site is secure.
Additional secure measure that you can take to avoid phishing scams and other online scams is to ensure that there is a good antivirus installed on your computer. “If you put an antivirus programme on your device, that will automatically protect you from the phishing mails that are sent out to you,” notes Vermeulen.
In addition to these safety measures, each bank has their own safety and security measures on their online banking sites which assist in preventing fraud. It is important that you are familiar with your bank’s internet banking policies to ensure that you do not accidentally visit a fraudulent site. For example, Absa highlights that they will never ask a customer to enter their entire password, but rather three random characters from the password.
If you suspect that you have been a victim of card fraud or you have lost your card, it is important that you contact your bank immediately to stop your card. Patel reveals that in addition to contacting your bank, you may also be required to report the incident to the police and get a case number from them.
Patel adds: “While anyone can fall prey to fraud or loss, being vigilant can minimise the damage. If you suspect foul play, act immediately - it’s better to overreact than suffer the consequences of being a victim of fraud.”