Renée Bonorchis
14 January 2009
Johannesburg — AFTER numerous warnings about banking fraud, banks said yesterday last month's figures indicated fraud was confined mainly to ATM incidents.
Gerda Ferreira, head of group forensic services at Nedbank, said the festive season was traditionally a period of heightened criminal activity across the banking sector.
"There were no robberies in December, but there were some ATM bombings," Ferreira said.
Standard Bank said that when it came to ATMs there had been an increase in skimming. "This occurs either through devices being placed on ATMs and/or 'social engineering' at ATMs," said spokesman Erik Larsen.
"For example, someone comes up and says 'I'm a bank official and need to clean your card'." Absa found ATM skimming, particularly with debit cards, was on the rise.
"ATMs have become a key hot spot," Absa fraud strategy head Nainesh Desai said yesterday. "There was an increase on the debit side. Credit cards showed a spike in December, but it was less than in November. Maybe the credit card fraudsters take a holiday."
Desai said transactions known to be fraudulent usually resulted in the customer being reimbursed. The bank was not insured for these losses as it was not cost effective to insure each client.
"We're trying to detect skimming faster," Desai said. The bank wanted to introduce more cards that used chips and PIN codes. But this, he said, was a balancing act between the losses the bank could stand versus the customer's ease of use of the cards.
For other types of transactions, such as internet banking, cheque fraud and credit card fraud, Standard Bank reported no increases over the holidays. It said there were no internet banking frauds last month, while credit card fraud was "largely contained by the bank's Europay, MasterCard and Visa chip roll-out".
Bank fraud rose last year. Research issued by the South African Banking Risk Information Centre (Sabric) showed credit card fraud losses on local cards rising at an annual average rate of 59,8%.
Sabric said KwaZulu-Natal, Gauteng, Mpumalanga and Western Cape accounted for more than 70% of credit card fraud losses since 2005. Gauteng accounted for more than 50% of credit card fraud losses last year.
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