Canadian debit card fraud hits record low as criminals go 'where it's easier to do the job'

Had your debit card skimmed lately? Chances are the problem didn’t happen in Canada where at technological updates and beefed-up online security have made it harder than ever for cyber thieves to operate in the Great White North.

That’s the big take-away from a new report from Interac Association, the company behind much of the world’s debit-card operations.

The report, released this week, found debit-card fraud losses overall reached a record low in 2014 of $16.2 million in 2014.

That’s down 45 per cent from a year earlier when total losses due to fraud cost financial institutions a total of $29.5 million, according to the report.

The really good news for the millions of Canadians who use a debit card every day to buy gas, groceries and coffee is that just 20 per cent, or $3.2 million, of the 2014 losses occurred from within Canada.

We’re far more likely to have our cards skimmed or to fall victim to an electronic pickpocket south of the border where the move to chip technology and other enhanced safety features have been slow to take hold.

“Criminals go to where it is easier to do their job,” says Caroline Hubberstey, head of external affairs at Interac Association.

“It’s our responsibility to try and shut them down,” she says.

Financial fraud is a threat most of us can relate to.

A national survey published by the Chartered Professional Accountants of Canada (CPA Canada) found that almost of a third (32 per cent) of us have fallen victim to financial fraud at some point in our lives.

Credit card fraud (cited by 67 per cent of those victimized) and debit card fraud (referenced by 29 per cent of the victims) are the top two types of fraud encountered, the survey found – a trend that was unchanged from a similar poll taken last year.

The 2015 CPA survey did show a sharp jump in the number of victims referencing online fraud. It was reported by 16 per cent of the victims compared with just six per cent in 2014. About half of all respondents who access the internet said they were uncomfortable making online purchases. That number climbs with age.

No doubt, epic security breaches such as the 2013 hack that siphoned credit card data and personal records of tens of millions of American Target customers do little to restore public faith in the safety of the e-commerce arena.

How to protect yourself

Hubberstey says, these days, the best thing debit-card users can do to protect their money from criminals is to guard that personal identification number, or PIN, closely.

“Only you should know it,” she says. “It is the biggest tip I can give.”

Debit-card skimming – that is, a device used to secretly captures the information contained in a debit-card magnetic strip, as well as the user’s personal identification number (PIN) – was once the go-to crime for tech-savvy thieves the world over.

But it’s been on a steady decline in Canada since the introduction of chip technology in 2009.

These days, swiping one’s bank card is pretty much a thing of the past, with Interac estimating about 96 per cent of point-of-sale terminals in Canada already converted to chip technology.

Payment service providers who don’t convert by the end of the year will face sanctions, Interac has warned on its website.

Virtually all ABMs have also now been converted to accommodate bank cards embedded with a microchip that is designed to block unauthorized users from accessing the account.