Chip and pin fails to halt card fraud rise

SHOPS have seen a massive rise in credit and debit card crime since the introduction of chip and pin technology, according to a report published today.

The new system was hailed as virtually fraud-proof but a survey by the Scottish Grocers' Federation (SGF) suggests card crime has soared by more than 50 per cent since 2005.

Retail chiefs are now seeking an urgent meeting with card companies in a bid to tackle the growing problem.

John Drummond, SGF chief executive, said: "We were shocked at the staggering rise in card fraud despite the introduction of chip and pin, which was supposed to stamp out credit and debit card misuse."

The 1000 stores surveyed reported a total of 143,425 of card fraud last year, a 54 per cent rise on 2005. Another 78,257 customer thefts were recorded in the same stores with only 14 per cent of the incidents reported to police. More than 3.8 million of stock was lost, or 4050 per store. But thefts by staff also accounted for 620,000 or 44 for every convenience shop in Scotland.

From last February, customers were expected to enter a pin number before they purchase goods with a card. The Association for Payment Clearing Servicesexpected the system to virtually eliminate fraud.