Debit card skimming fraud hits record low

Victims of Interac fraud take heart: debit card fraud losses due to skimming are at the lowest level on record, thanks in part to chip technology.

The losses fell to $38.5 million in 2012 – the lowest since 2003 – from a high of $142 million in 2009. That represents less than 1 per cent of domestic Interac debit card volume, the Interac Association said on Tuesday.

Caroline Hubberstey, the head of external communications for the association, says the ongoing conversion to chip technology is a vital tactic in the fraud prevention strategy.

She also said fraud prevention is further boosted by partnerships with law enforcement, financial institutions, acquirers, merchants and educational outreach to consumers. Issues around fraud are in the spotlight due to March’s Fraud Prevention Month.

Unlike a magnetic stripe, chip technology makes it extremely difficult to copy and reproduce. As of the end of January, 99 per cent of all active Interac debit cards and 99.6 per cent of automatic banking machines had been converted to chip.

Nearly 90 per cent of point-of-sale terminals, where skimming can occur, had been converted. All POS terminals are expected to be converted by the end of 2015.