The channel is on red-alert following figures showing card-not-present (CNP) fraud continues to rocket in the UK.

According to the Association of Payment Clearing Services (Apacs), losses from online, phone and mail order fraud totalled £137m in the first-half of 2007, up 44 per cent on the same period last year.

However, Apacs played down the rise, pointing out that the fraud to turnover ratio on online card transactions had actually decreased between 2004 and 2006.

“Losses from online, phone and mail order shopping fraud have continued to increase year-on. However, this increase has to be seen in the context of increasing numbers of people shopping online and ever-growing numbers of online transactions,” Apacs said in a statement.

In fact, Apacs was generally satisfied that card fraud levels are under control.

Total card fraud losses increased 26 per cent year-on-year, but this was driven solely by an increase in fraud on UK-issued cards used overseas.

Domestic card fraud actually dropped, with losses at UK retailers down 11 per cent and losses at UK cash machines tumbling 57 per cent.

Sandra Quinn, director of communications at Apacs, said: “These figures show how the fraudsters have changed tack. A couple of years ago they were mainly stealing cards and card details for use in UK shops and cash machines, but today, because of chip and PIN, they have been driven overseas - using fake magnetic stripe cards specifically in countries which have yet to upgrade to chip and PIN.”

Further reading:

London tops the chart in CNP fraud

Resellers warned about rising CNP fraud levels