Credit card fraudsters slip the net

Under rules which came into force in April, it is now the responsibility of banks to decide which offences to pass on for investigation, BBC2'S Newsnight discovered.

Critics suggested the move was being made to reduce crime figures and demanded a rethink.

Almost £430 million was lost as a result of credit and debit card fraud in the UK last year.

Tory e-crime spokesman James Brokenshire said: "With one in three people being the victim of credit card fraud, it's essential that there is no reduction in reporting or any suggestion that this type of crime is being downgraded - especially if this is to bring down reported crime levels.

"It is therefore astonishing that the Home Office seems perfectly happy to just rely on the banks to sort it out.

"The Government clearly hasn't got a grip on this issue or an appreciation of the seriousness or scale of the problem."

A Home Office spokesman confirmed that discretion had been handed to the banks to ensure the police could concentrate on cases "more likely to result in a positive outcome".

He said: "The Government is determined to tackle the problem of card fraud, whether the account holder is an individual or multi-million pound organisation and we are working closely with finance and retail sectors along with the police to tackle this crime.

"Since April 1, financial institutions have been responsible for reporting acts of card fraud to specifically designated police contacts.

"Financial institutions work closely with the police and will report such offences with the supporting information which the police need.

"On occasions where financial institutions recognise there is insufficient evidence to support a police investigation they may choose not to report a crime.

"These changes to reporting procedures ensure that police resources can be directed at fraudulent activity that is more likely to result in a positive outcome.

"As always individual police forces will decide how best to allocate resource for dealing with crime.

"Apacs (the UK payments association) keeps comprehensive data on all fraud on UK issued cards.

"Home Office statistics publications will use this data as giving the best overall picture of levels and trends in card fraud."

Sandra Quinn of Apacs told last night's Newsnight the police had not been investigating minor cases before the new rules - which the banks had not requested - came into place.

"Unfortunately the police don't have the resources to investigate all types of card fraud," she said.

She insisted that hundreds of cases were being reported every month.

"As an industry we have a vested interest in making sure card fraud is investigated and the fraudsters prosecuted."

Asked if the banks were not now acting as "judge and jury" when the fraud was committed by their own staff, she said: "It is not in our interests as an industry to not be up front about this.

"One of our great concerns is the security of our customers' money."