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Card Fraud Update

Card Fraud Update

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Card Fraud Update

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  1. Card Fraud Update Presented by: Úna Dillon, Head of Card Services, Irish Payment Services Organisation IIA Fraud Seminar, Thursday 22nd January 2009

  2. Agenda • Introduction to IPSO • Overview of Irish Payment Card Market • CNP Card Fraud Overview • Fraud Prevention Initiatives + Chargeback Handling

  3. Introduction to IPSO IIA Fraud Seminar, Thursday 22nd January 2009

  4. Introduction to IPSO • The Irish Payment Services Organisation Limited (IPSO) is the representative body of the payments industry, the voice and guardian of the payments industry and the strategic interface with all payments stakeholders • The IPSO umbrella body is made up of the following: • IRECC • IRIS (to Feb 2009) • IPCC • Direct Debit Scheme • Laser Card Services Ltd • IPSO Card Services

  5. IPSO Card Services Members: _____________________________________ Contributors:

  6. Current Card Market IIA Fraud Seminar, Thursday 22nd January 2009

  7. Overview of Irish Card Market Card Base • Debit (Laser) cards 2.9m • Maestro + Visa Debit (non-disclosable) • Credit cards 2.4m Issuers • Credit Card Issuers 12 • Debit card Issuers 9 Acquirers • Acquirers 4+ Transactions • Laser Card: €9.1bn (’08) • Credit Card: €12.6bn (to Nov’08)

  8. Card Fraud Overview and Trends IIA Fraud Seminar, Thursday 22nd January 2009

  9. Card Fraud

  10. CNP or Card Not Present Fraud includes:- fraud conducted over the internet, by telephone or; via mail order Criminals obtain card details by stealing data, using discarded receipts or copying details during a transaction Biggest fraud problem in Europe (up to 50% increase ‘06 to ‘07) CNP Fraud Overview

  11. Card Fraud Types

  12. E-commerce There are over 10,000 ecommerce stores in Ireland (source Realex) E-commerce has enabled businesses to become more efficient and reliable It is essential for businesses - to be able to market their products and services on a global market Unfortunately – they are the latest crime target • Data hacking • Phishing • Staff abuse (collecting details during transactions)

  13. Fraud Prevention IIA Fraud Seminar, Thursday 22nd January 2009

  14. Card Fraud Prevention - Banks Industry Solutions: • Industry specialist groups (IPSO CFF, IBF HTCF) • Market Intelligence (MI) • Training – SafeCard Task Force (IPSO) • Conferences, seminars, localised training (industry representative bodies) • Card Security Code (CSC) • Proactive awareness campaigns (e.g. PIN usage) • Intelligent computer systems (e.g. Hunter, Falcon) • International Representation (IPSO) • Counterfeit card fraud prevention • Liaison with Gardaí (GBFI) • Lower floor limits • Hot Card Files • PCI DSS • 3D Secure

  15. www.SafeCard.ie

  16. Card Fraud Prevention - You No one solution – need to combine many • Ensure all of the cardholder’s details are captured • Ensure contact phone numbers are landline rather than mobile (can be untraceable) • Obtain fixed email addresses (no free ones) • Use Card Security Code (no retention) • Use 3D Secure solutions (fraud liability shift) • Comply with PCI DSS (encryption) • Be aware of card scheme dispute resolution rules (Chargebacks)

  17. Chargebacks IIA Fraud Seminar, Thursday 22nd January 2009

  18. Chargebacks In a CNP environment, the onus is on you to provide proof that the bona fide cardholder performed a given transaction • The cardholder could have made a mistake, or • they may be a criminal Chargeback Cycle: Customer Dispute → Issuer investigation → Chargeback → Representment → 2nd Chargeback →Arbitration

  19. Chargeback Reasons: Retrieval Request Processing error Cardholder dispute Authorisation Fraud CNP - Where there are suspicions of fraud Merchant fraud or collusion Implication circumstances surrounding the transaction were improper or possibly fraudulent Not authorised (approved) Not sent to cardholder address Expired/not yet valid card Split sale (floor limit) Not cardholder name Chargebacks

  20. Chargebacks Specific Time limits provided for the process and resolution (card scheme rules) For example: • Retrieval Request acquirer to respond within 45 days • First Chargeback acquirer to respond within 60 days • Second Presentment Issuer to respond within 45 days When you receive a chargeback notification from your bank or acquiring processor: • You have an opportunity to dispute the chargeback • Be mindful of the time limits which are imposed on your acquirer • Gather information on the transaction and cardholder and send a copy in response to the notice.

  21. Finally…… Keep informed of industry fraud trends: • Liaise regularly with your acquirer • Refer to reputable websites for new information: • www.safecard.ie • www.makeitsecure.ie • http://www.shopsafeonline.org.uk/retailers/

  22. Úna Dillon IPSO 14 Cumberland St Dun Laoghaire Co. Dublin Email: una.dillon@ipso.ie Website: www.ipso.ie Website: www.safecard.ie Contact Details